Understanding the Step-Up in Basis Rule

In this video, I break down the step-up in basis rule—a key tax law that can significantly impact the taxation of inherited assets. Here’s what you’ll learn:

• What is the step-up in basis?
  I explain how this rule adjusts the cost basis of an inherited asset, like a home, to its current market value at the time of the original owner’s passing.

• Why it matters for your family:
  I highlight why you should avoid putting your children on the deed to your home. Doing so can prevent them from benefiting from this important tax advantage.

• A real-world example:
  I share a scenario where a home purchased for $100,000 increases in value to $300,000. Thanks to the step-up in basis, heirs avoid paying capital gains tax on the $200,000 gain.

• Important considerations:
  I also discuss what happens when inherited property is sold and remind you that tax laws like this are subject to change by Congress. Staying informed is key.

This video is for informational purposes only. As always please get professional help before making decision on how to protect your assets.