Basis of survivor in jointly owned property

[curiousgeorge]

For a quick (probably unwise) estate plan, mother added son's name to condo and an investment account (equities, mutual fund).  When mother passes away, what would be the son's cost basis on the condo and on the equities & mutual fund?
Thanks.

[justme]

Well, it wouldn't be stepped up to current basis as it would if he inherited it after she died. 

[mwcpa]

it will be a step up... all of the assets are Mom's and nothing was contributed by the son....

had this been a married couple this would be split 50/50... half of the assets would get a step up and half would be carry over....

[curiousgeorge]

Thank you!

[rangerj]

Added thoughts:

Whether, or NOT, there is a gift depends upon whether there is a transfer of title. A transfer of title before death is a gift and the basis of the recipient is the same as the basis of the donor (giver), plus any gift tax paid (if any). A transfer of title after death (to a survivor) by inheritance results in the basis to the heir being the fair market value (FMV) on the date of death, or six months after the date of death if the alternative date is applicable AND elected. Also of note is that such transferred property is considered as "long term" for capital gains/losses purposes. Transfers of material amounts of money or property should be done with professional federal estate and gift advice as well as advice regarding local/State law effects on the transfers. I have very frequently seen the FMV appraisal "low-balled" in order to avoid a small State or local tax, and in doing so creating a substantial federal capital gain at a higher tax rate. Get your advice from a tax professional and not from "Joe the plumber" or Nickie the nephew.

[curiousgeorge]

Thanks Ranger!