S-Corp Basis Step Up - S-Corp owns installment sale loans

S-Corp sold real estate and is reporting income as an installment sale. There is $400K left on the installment loan with a 70% gross profit. Sole shareholder dies leaving stock to son.

Is his basis in the stock $400K at time of inheritance?

When the installment loan pays out and the S-Corp distributes $280K of gains to him does that increase his basis to $680K?

I don't think so. I just don't know where it says it doesn't increase basis. It feels like IRD but the corporation didn't die.

Might be under 453B.
That's where installment obligations in S-corps are referenced.

I just don't know where it says it doesn't increase basis.

Does it say anything about it here?

Code Sec. 1367(b)(4)(B); Reg § 1.1367-1(j).