Re: estate tax question
Basically, (and this is very basic as there can be a lot of twists and turns with estate tax issues), if someone dies with a taxable estate, the estate tax is calculated on the total value of all assets, less the total of all debt and expenses of the estate. The estate files a tax return and pays the tax out of the estate assets. If on closing of the estate, the building is distributed to you, you get a 1,000,000 basis in the building. Often when a property is encumbered by a mortgage, the estate will sell the property and payoff the mortgage, distributing the net cash to heirs. The estate could also payoff the mortgage with other assets and distribute the building to the heirs. The building with the mortgage still on it could be distributed to heirs, but this would require lender consent (which it might not give) and the agreement of the heirs to assume the mortgage.
No more lawyer stuff, no more political stuff, so no more CYA