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Shareholders would then be able to increase their tax basis.
Documented capital improvements get added to their adjusted tax basis.
At the same time, however, the tax basis for the property basically remains unchanged.
High-equity, low-property tax basis, and simple familiarity and comfort is a driver here.
The difference between the sale price and the tax basis is taxed as capital gain.
This tax basis step-up is comparable to what happens with stock after a shareholder dies.
Similar(22)
On a pre-tax basis, the bank lost $730m.
Participants may elect to make contributions on a pre-tax basis, or a post-tax basis (through a Roth plan).
This year the firm switched to a post-tax basis.
A year later that had risen to £17.4m on a pre-tax basis.
On an after-tax basis, this ends up being about $1,000.
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