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tulkuu wrote:
I agree CFAI answer is right, but I still have a doubt on its reasoning.
“For the revocable trust, the cost basis of investments inceases to market value on the date of Becker’s death,…”.
What does it mean? No capital gain tax at his death if not to sell the shares today? Thanks.
IMO, at death no capital gain tax, but estate tax of 20% for the total value (including cost base and capital gain) is applied. The net tax estate value (market value) become new tax base for future capital gain taxes.