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Income Tax Planning
Chapter 10: Basis Rules, Depreciation, and Asset Categorization/IMPACT OF GIFT TAX ON BASIS
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Chapter 10: Basis Rules, Depreciation, and Asset Categorization

IMPACT OF GIFT TAX ON BASIS

01.Core Concepts

• Donee’s basis is increased by a portion of gift taxes paid by the donor if: • The fair market value (FMV) is greater than the donor’s basis on the date of the gift. *The “FMV of Property at Date of Gift” is the amount of the taxable gift, which includes a deduction for any gift tax annual exclusion taken for the gifted property.