I thought this was pretty ho-hum, the IRS just stating what has been known for years. But then I read this article:
I am curious as to your thoughts.
Even more interesting is this:
"If and when the Tax Court, the Court of Claims, and/or an appellate court agree with the position that a step-up in basis has occurred on the death of a Grantor, then tax practitioners and their clients will question whether the best advice was to not take the step-up, or to take the step-up and advise the IRS in the conventional manner available of the position taken. Many taxpayers will file an income tax return and pay the tax as if no step-up occurred, and then file an amended return with prominent disclosure to reduce or eliminate the IRS's ability to impose negligence and substantial understatement penalties. "
If an amended return is filed in order to assert there was a step up in basis and the IRS denies that position, is there a time limit for future recovery in the event a court later holds that position was indeed correct?