CAPITAL GAINS TAXES

[spunkytoto]

North Carolina

last dec.2000,my dad in bad health deeded over property to me and my brother. he passed away 5-17-01. he sold it to us for a token 10.00. since this was essentially part of his estate that would have been ours anyway according to his wishes in his will would we be subject to a big capital gains penalty???It will probably sell for around 125,000. also the will is notarized and filed, however it has not been recorded(book and page at the top), i do also have power of attorney papers which are filed and recorded. can i take the will and have it recorded without having the death certificate or do i even need to do that????

 

[ALawyer]

IF THE ASSET WAS OWNED BY HIM AT DEATH IT WOULD HAVE BEEN GRANTED A STEPPED UP BASIS. No tax on sale. If you bought it for $10 in Dec and sold it now, you'd have huge gain, and as it is less than a year, it would be taxed as short term gain.

This is one to talk to a NC lawyer about. Perhaps the sale was not effective or closed, or who knows what.