All Forum Posts by: Michael Alvarez

@Ashish Acharya Thank you for your reply. Yes, 50% was actually bought out, but it wasn't a straight transaction where cash in the amount of 50% of the FMV was transferred. Instead, funds that were advanced to the estate and other liabilities (like the mortgage) were deducted from the final payments. Additionally, the value agreed upon for the buy out was slightly less than the appraised FMV. Therefore, the money actually transferred between us does not add up to 50% of the FMV.

There was a distribution agreement, which the probate/tax attorney prepared and was filed with the court, but the only document that is publicly recorded is the court's distribution order, which also functions as the deed. It specifies the distribution of the house to me and my older brother in equal shares, along with cash payments to my two younger siblings in the amount of 50% of the estate's net value, to be paid by me and my older brother. The net value was calculated by subtracting the estate's liabilities, so the payment amounts were far less than the FMV. The order does not specially say that the payments are for the purpose of acquiring 50% of the house.

The attorney who prepared and filed all of the paperwork says that my basis is simply 50% of the FMV. But the CPA who I hired says that a full accounting of the estate and payments made is required to determine the basis. The CPA also expressed concern that a lower basis for the portion acquired would also lower the basis for the portion inherited.

Does this give you more information to determine which position is correct?

My mom passed away a few years ago, and the main asset that she left behind was her house. I have three siblings, so each of us were entitled to 25% each. However, my two youngest siblings did not want to keep their interest in the house, so my older brother and I decided to buyout their shares.

My mom's estate went through probate. An appraisal was done to determine the FMV of the house. In the end, the house was distributed from the estate to me and my older brother with 50% ownership each. The buyout payments were also included in the distribution order.

The buyout payments do not exactly align with the appraisal, and I am having a hard time getting a clear answer on what my cost basis is. I have asked the probate/tax attorney, as well as paying for some time with a CPA, but they are giving differing opinions. One says that my basis is simply 50% of the appraised value, while the other says that only my original 25% share receives a step-up in basis and the other basis for the 25% that I acquired is determined by how much I spent.

Since the asset passed directly from the estate to me and my older brother, without another transaction in between, I am leaning towards just using the appraised value. Does anyone have any insight on this? Thank you in advance.

I used a leasing agent to rent out a SFH last year. The lease is expiring at the end of March, and I would like to get some pointers on how to properly renew the lease.

The current lease is written using C.A.R. Form LR, Revised 12/21, and includes the following disclosures: Bed Bug Disclosure (rev. 12/18), Tenant Flood Hazard Disclosure (rev. 12/18), Rent Cap and Just Cause Addendum (rev. 12/20), Fair Housing & Discrimination Advisory (rev. 10/20), and Information on Dampness and Mold for Renters in California.

Would I be okay if I reused these same forms and just update the information? Are there any new disclosures for 2023 that I need to add? Thank you in advance!