Please forgive my ignorance on taxes and capital gains. I promise I have looked on the IRS website and googled but now am just totally confused.
My 86 year old FIL recently passed in early February of this year. My BIL is the Executor of the estate and is going through the state-mandated probate process. I am trying to help him with all the paperwork, etc. as best I can, but it is a bit of the blind leading the blind. We have an attorney helping with all the court filings and legal paperwork, but some things are not handled/included with their services.
Which leads me to my tax information needs question. My FIL had a taxable brokerage account with 3 or 4 stock mutual funds as well as a money market account. My BIL will sell these and split the money between 4 siblings. My understanding is that there is a stepped-up cost basis for the stock mutual funds based on the date of death. So no capital gains or inheritance tax on that money for the siblings. However, there has been some gains in the value of the stock mutual funds since FIL's date of death in February. I am assuming the 4 siblings will have to pay taxes on those gains when they file their taxes? What information do they need in order to properly do that? Is there something they should ask the broker/FA for when they sell the mutual funds and distribute as cash payments to the 4 siblings?
Am I even asking the question correctly?!
My 86 year old FIL recently passed in early February of this year. My BIL is the Executor of the estate and is going through the state-mandated probate process. I am trying to help him with all the paperwork, etc. as best I can, but it is a bit of the blind leading the blind. We have an attorney helping with all the court filings and legal paperwork, but some things are not handled/included with their services.
Which leads me to my tax information needs question. My FIL had a taxable brokerage account with 3 or 4 stock mutual funds as well as a money market account. My BIL will sell these and split the money between 4 siblings. My understanding is that there is a stepped-up cost basis for the stock mutual funds based on the date of death. So no capital gains or inheritance tax on that money for the siblings. However, there has been some gains in the value of the stock mutual funds since FIL's date of death in February. I am assuming the 4 siblings will have to pay taxes on those gains when they file their taxes? What information do they need in order to properly do that? Is there something they should ask the broker/FA for when they sell the mutual funds and distribute as cash payments to the 4 siblings?
Am I even asking the question correctly?!