Appreciated property that was inherited in 2017

Question

Quizplus · Accepted Answer

Property inherited in 2017 will have a stepped-up basis, which means the basis of the property is the fair market value at the date of death of the decedent. This step-up in basis avoids income tax on the appreciation prior to the date of death. Additionally, any post-inheritance appreciation on a future sale will also avoid income tax. Therefore, both (a) and (b) are true, making answer choice D the correct one.

Appreciated Property That Was Inherited in 2017