 |
BasisThe basis in a home is determined by how the taxpayer obtained the home. For example, if a taxpayer bought or built a home, the basis is what it cost the taxpayer to buy or build that home. If a taxpayer received a home through an inheritance or as a gift, the basis is either its fair market value or the adjusted basis of the home. If the taxpayer inherited the home, the basis is its fair market value on the date of the decedent's death, or the later alternate valuation date chosen by the representative for the estate. 
Alternative valuation issues can be complex; you should advise the taxpayer to seek professional assistance. Determining the adjusted basis of property received as a gift can be very complex and is outside the scope of the VITA/TCE program. Advise the taxpayer to seek a professional tax preparer. 
Determining the basis of property inherited in 2010 is complex and outside the scope of the VITA/TCE Program. Refer taxpayers who sold property that was inherited in 2010 to a professional tax preparer if they do not know the basis and the correct holding period. 
|
