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Will I Receive a Step-up in Basis for This Gifted Property?

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In most cases, there is no step-up in basis when property is gifted. But there are a few exceptions to the general rule, which can be difficult to remember.


This flowchart addresses some of the most common issues that arise while trying to understand the cost basis in property received as a gift. It considers:


  • Double basis rule
  • Impact if gift tax was paid by the donor
  • Situations where cost basis carries over
  • Situations where there is a partial step-up in basis
  • Situations where no gain or loss is recognized

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