Many thanks in advance and sorry about your loss

Sean
www.sean.co.uk

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Many thanks in advance and sorry about your loss

Sean
www.sean.co.uk

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Many thanks in advance and sorry about your loss

Sean
www.sean.co.uk

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Arthur L. Rubin <ronnirubin[at]sprintmail.com> wrote:
- quote -

I disagree. In the case of life insurance, the contract
specifies it becomes payable as a result of the death, so
the death itself increases the value.

Under more general circumstances, it's the _knowledge_ of
the death that causes the increase in market value. Since
that knowledge must follow the death itself by some amount
of time, the (market) value _immediately_ after death would
not have increased. (If knowledge of the impending death
were available, then the value would increase prior to
death.)

Seth

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Paul A Thomas wrote:
- quote -

No INCOME tax would be due.

Since you seemed to have gotten the rights to them, no
estate tax will be due either, but they will have to be
listed on such a return if it is needed (along with a
marital deduction of the same amount).

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"Arthur L. Rubin" <ronnirubin[at]sprintmail.com> wrote:
- quote -

My recollection is that it's the value at the moment before
death. Life insurance is a special case with a specific
statute dealing with the issue.

Stu

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Arthur L. Rubin wrote:

- quote -

While that would be an interesting research project <grin> ,
I probably wouldn't dig into it unless it was clear that was
the reason for the rise in value. Now, if that's the case
here then it would be important to see if that is viewed as
an item that impacted the value after the basis was
determined--but unless that is the fact pattern, I don't
think the original poster has to worry about resolving this
issue <grin> .

--
Ed Zollars, CPA
Phoenix, Arizona

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I would be suspicious of the $75,000 offer coming up so
quickly. How do you know you are not being lowballed?

Ask your attorney for assistance or advice in obtaining a
decent fair market value appraisal.

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Ed Zollars, CPA wrote:

- quote -

I can imagine circumstances under which his death, itself
would increase the value. I don't recall if it's the
value immediately before death or immediately after death
which is considered the value for estate tax and step-up
considerations -- I suspect the latter, as in the case
of life insurance, but I'm not certain.

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- quote -

Three weeks after death a willing buyer offered a willing
seller $75,000. Isn't that almost the definition of fair
market value? Unless something drastic happened during
those three weeks.

--
Don EA in Upstate NY

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Harlan Lunsford wrote:

- quote -

As Dan notes, given the short time frame between the date of
death and the date of sale, the odds are pretty strong that
the offer constitutes a very good measure of its fair market
value at the date of death. I'll put it this way--were
there a *taxable* estate and this sale took place, the IRS
would waste no time in pegging the value at *least* at $75K
for estate tax purposes <grin> .

Now, there could be facts that might establish the value
rose after his death--for instance, some major event occurs
that suddenly makes the name worth a lot of money while
before no one would have cared. But absent such facts, the
IRS is going to have a difficult time establishing a value
other than the sales price.

--
Ed Zollars, CPA
Phoenix, Arizona

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Barbara wrote:

- quote -

If you can't establish a fair market value of said domain
names on the date of his death, sure.

Now that's a tall order I admit to determine such a value.
Where to start I haven't a clue. But it's worth looking
into.

Cheer$,
Harlan Lunsford, EA n LA

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"Barbara" <forgetit[at]nospam.net> wrote:

- quote -

My sympathies on the death of your husband.

- quote -

Unlikely to be income tax, since your tax basis in property
you inherit from him is its value at the date of death. So
if you sell it for that amount, there is no taxable income.

The value of those assets must be included in his estate for
estate tax purposes. Taxes may be owed if his estate is
large enough to exceed the exemption amount.

Stu

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"Barbara" <forgetit[at]nospam.net> wrote:

- quote -

First, please accept my condolences on your loss.

I am not familiar with WI state tax issues, so I will limit
my comments to Federal issues.

You will likely NOT owe any taxes on this sale. When you
inherit property you get to use the Fair Market Value of the
property at the date of death as your basis in the property.
The difference between the FMV and the sale price is your
gain or loss. Since there has been only a few weeks between
your husband's death and the offer to buy the domain names I
would argue that the offer IS the FMV. Hence, a sale this
close to the date of death would likely result in no gain or
loss.

There are factors that could impact this situation, though.
Like whether you and he owned them jointly, whether he owned
them by himself, whether WI is a community property state
(though this could impact the result I don't think it could
hurt the result), etc.

If I may - was your husband in the process of trying to sell
these domain names prior to his death? If not, what
prompted the buyer to contact you? My concern here is that
your husband could have been approached about selling the
names but thought that they were worth more than he was
being offered. I have no way of knowing, but I would
suggest you look into to this to make sure you aren't giving
them away at $75K.

I would urge you to seek out professional guidance BEFORE
you make any decision to sell.

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Barbara wrote:

- quote -

Perhaps. You'll have to report the sale on a 1040 Schedule
D, but there may be no tax consequences.

What was the "value" of the domain names on the date of
death? If you can justify that as the same as the offered
price, there would be no gain to report.

On the other hand, you may be required to file estate
reports (probably not a Federal estate tax return, but
possibly a State estate tax or inheritance tax return, or a
probate report). I seem to recall a trigger amount of
$60,000 in California; it may very well be smaller in
Wisconsin.

If Wisconsin is a community property state, and the domain
names are community property, then (probably) only half of
the basis is stepped up on death, and you WOULD owe capital
gains tax, but at a nominal tax rate of no more than 15%.

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Barbara" <forgetit[at]nospam.net> wrote:

- quote -

Whatever your husband owned that passes to you will qualify
for the federal estate tax marital deduction, so there
should be no federal estate tax (or Wisconsin estate tax)
unless more than $675,000 (the Wisconsin exemption) passes
to someone other than you.

So the value of the domain names is probably irrelevant for
death tax purposes.

For income tax purposes, I believe that there will be
long-term capital gain on the difference between the sale
price and the cost basis, which would be fair market value
at death in this case. Since your husband's death occured
only a few weeks ago, you would have a good argument that
the fair market value is what you were just offered, in
which case you would have no taxable gain on the sale.

**Dan Evans
**I post information, not advice.

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"Barbara" <forgetit[at]nospam.net> wrote

- quote -

Sorry to hear of your loss.

- quote -

To the extent that the domain names were valued at $75,000
at the time of his death, you would get a step up in basis
to that value, so no tax would be due.

--
Snowmen fall from heaven unassembled.
-------------
Paul A. Thomas, CPA
taxman at negia.net

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- quote -

Sorry on your loss, but in your grief, do not be dollar
foolish. Get thee to a good tax professional and soon. You
may even want an estate expert and a lawyer involved. This
could be a lot of money you are playing with and wanting
maybe not quite right advice on.

Helen, EA in PA
Member of The Tax Gang
Immediate Past President, PA Society of Enrolled Agents

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I live in Wisconsin. My husband died a few weeks ago. His
will left me everything. I always thought the most valuable
thing he owned were his Green Bay Packer season tickets. But
I got a letter on Friday from someone who was making an offer
of $75,000 for three domain names he owned.

Will I owe taxes on this?

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