All Forum Posts by: Hans Cooke

All great info and advice Joe.  Thanks!  #3 is spot on.

Thanks much Russell.  :)

Hi Steve.  We inherited property in 2012 from a relative.  That is my primary concern currently and how changes in tax law will affect our upcoming sale of the property this year.  We may use a 1031 exchange if able.

If the Step Up Basis does get the "axe"... that means that it would only apply in the future at the time of death for someone willing property correct?  Meaning that someone holding RE that was inherited in the past will not be affected.

Will Biden eliminate the 'Step up' policy for inherited assets?

https://www.forbes.com/advisor...

I am concerned because we are looking to sell the one and only property we have inherited from a relative this coming Spring or summer.

Could we get screwed by this?  If it was put into law this year, would it take effect for tax year 2021 (part of me doubts this)?

If the 'Step Up basis' for inherited assets is taken away in the near future (even if after 2021), then using a 1031 exchange this year on an inherited investment property may be the wrong move as a we would end up paying a lot more capital gains tax in the future when we do sell.  Would it be better to forget using 1031 and just take the smaller capital gain hit now under current law.  Am I missing something or is my thinking correct?

I miss the boring days when there was not that much difference (compared to today) between Democrat and Republican tax policy.  Was much easier to plan.

Thanks Bill.  Good advice.  :)

Thanks Bill.  I guess a good CPA will be able to help me crunch numbers before sale to determine whether I can do a 1031 and if I even should based on investment plans.

Would you all recommend I find a good CPA in California near the property (Silicon Valley area) or would a local Texas CPA near where I live now suffice?

Wanted to add something I just discovered that may scuttle the 1031 plan.  The inherited property is in California.  California has a "Claw Back" law in place that could very likely make a 1031 exchange harmful in the long run.  :(

Thoughts?

Thanks much @Dave Foster !

@Dave Foster, Thanks much.

Never received and rental income for the property but have been holding for appreciation for 9 years.  Have never used for personal use.

We are looking to sell this spring/summer.  For an accountant, would a CPA be good enough or would a Tax Attorney be the way to go?