I'm going to be meeting with the client of my friend who is a real estate agent with the goal of discussing the FMV of a piece of property and what taxes she can expect on this property. The property is a lot in Honolulu, no buildings on it.
What I know is this:
MR was named the successor trustee to a trust dated in 1991 and inherited the property via the death of the trustee. I'm not clear on the date of death at this point. I'm also not sure there is a record of the FMV at the DOD. So if there is no record, how do we establish that?
In 2004 MR filed a Quit Claim Deed conveying title to PM, her sister, for $100.
Now PM wants to sell the property. Will her cost basis be the DOD FMV plus the $100? or will it be $100? (added as an edit) I just found an article, and I believe PM's basis will be MR's basis plus $100, and the property will be considered a gift to PM from MR, which supports the fact that PM's basis is the DOD valuation, plus the $100. MR should probably have filed a gift tax return, but she is not who I am going to be speaking with.