When property is transferred from a living (revocable) trust to a beneficiary on the death of the grantor, the beneficiary receives a stepped-up basis. Any appreciation after the grantor’s death is taxable to the beneficiary when he/she sells the property.
A statutory term used to figure your profit or loss on a sale or exchange. Generally, it is sales proceeds plus mortgages assumed or taken subject to, less transaction expenses, such as commissions and legal costs.