3 siblings have a life estate with one parent for quite a few years. When life estate tenant passes away the siblings are owners? What is their cost basis if they sell the house? Is it the value of the house upon date of death or the original cost of the home plus improvements?
2007-05-11 05:34:58 · 2 answers · asked by William F 2 in Business & Finance ➔ Renting & Real Estate
I believe the basis would be the value of the property when the life estate was created minus any capital improvements to improve the property.
It would also depend on who created the life estate. If the current parent deeded the property to their children and reserved a life estate for themselves there could be some gift tax implications.
You really need to talk with a lawyer or CPA on this one; probably a CPA would be the best choice.
2007-05-11 07:01:49 · answer #1 · answered by VolunteerJim 3 · 0⤊ 0⤋
Just a guess--I would say it is at time of death. If it is very important--there much have been a will--with an attorney--ask him.
2007-05-11 05:52:02 · answer #2 · answered by old_woman_84 7 · 0⤊ 0⤋