Step Up Basis for House in Trust

[momjd]

If a primary residence of a widow is transferred to a living trust to avoid probate, will her trust beneficiaries get the house at a stepped up basis? Assuming she paid $100K for the house in 1989, at the time it is transferred to the living trust it is worth $500K, and at the time of her death, it is worth $700K, what is the basis for the trust beneficiaries?

 

[seniorjudge]

http://www.irs.gov/businesses/small/article/0,,id=106537,00.html


I don't know anything about trusts but I thought this was interesting.

 

[taxlawkid]

check Pub 551

http://www.irs.gov/pub/irs-pdf/p551.pdf