Legal Question in Tax Law in Pennsylvania
My father, in Pa., bought a car 25 years ago for $75,000. At DOD it was worth 900,000. My mother inherited his estate and her basis would be $900,000. If she gifted it to me several years later is my basis $900,000 ?
1 Answer from Attorneys
Yes. If the vehicle ran through your father's estate, your mother inherited it at the date of death value, as reported on the inheritance tax return (PA-1500). If she then makes a gift to you (or anyone else) of the car, the recipient of the gift takes her basis, which would be $900,000 in this case. The value of the vehicle at the time of the gift does not matter. Remember your mother will need to file a gift tax return if she makes a gift of that amount, though there will be no tax due unless she has already gifted millions of dollars.
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