Carryover Basis: A Cure Worse than the Disease?
2 Pages Posted: 19 Oct 2010
Date Written: October 18, 2010
This article discusses the tax treatment of capital gains at death. In 2001, Congress enacted carryover basis beginning this year, meaning that heirs inherit the original basis for tax purposes along with the assets. When they are sold, they are supposed to pay taxes on all the gains accrued since an asset was originally purchased by the decedent. This was tried previously and proved to be an administrative nightmare.
Keywords: Carryover Basis, Step-Up Basis, Capital Gains, Estate Tax
JEL Classification: E62, H23, K34
Suggested Citation: Suggested Citation