Basis and capital gains
Inherited assets generally receive a new basis equal to their value at death (Internal Revenue Code §1014). Giving appreciated property away during life can forfeit that step-up, so the timing of a gift or sale matters.
Homewood · Tax Planning
Tax Planning Attorney in Homewood, CA
Coordinate gifts, sales and inheritances with your estate plan — before the tax bill sets the terms.
- County
- Placer County
- Probate venue
- Superior Court of California, County of Placer
- Route to our office
- State Route 89 north through Tahoe City to Truckee
- Region
- West Shore, Lake Tahoe
Tax decisions inside an estate plan
Most families never owe federal estate tax, but income tax, capital gains and property tax still shape what heirs receive. The Andrews Law Firm, P.C. helps Homewood clients make tax-aware planning decisions and coordinates with their accountant.
Gifts and the annual exclusion
In 2026 you can give $19,000 per recipient without using lifetime exemption. Larger gifts require a gift tax return but rarely tax, and they can support family members while reducing a larger estate.
Property tax and Homewood real estate
Proposition 19 limits the parent-child exclusion to a family home or family farm that becomes the child’s principal residence. Second homes and rentals are reassessed when they pass, which can change whether heirs keep or sell.
A worked example
Why the step-up matters.
Parents bought a Homewood home for $300,000. It is worth $1,100,000 today, and the child will sell it.
Inherited at death
- Child’s basis
- $1,100,000
- Sale price
- $1,100,000
- Taxable gain
- $0
Internal Revenue Code §1014: basis steps up to value at death.
Given during life
- Child’s basis
- $300,000
- Sale price
- $1,100,000
- Taxable gain
- $800,000
Internal Revenue Code §1015: a gift carries over the parents’ basis.
Simplified illustration: selling costs, improvements and exclusions are ignored.
California rules that apply in Placer County
The same state law, applied to Homewood property.
Homewood's West Shore homes are frequently long-held family cabins shared by several heirs. Written terms for use, costs and buy-outs help keep a shared property from becoming a dispute. Homewood is in Placer County.
Read the full tax planning guide- $19,000 per recipient (2026)Annual gift exclusion
Married couples who split gifts can give $38,000 per recipient without using exemption.
- Fair market value at deathStep-up in basis
Inherited assets generally take a new basis equal to value at death (Internal Revenue Code §1014).
- Both halves can step upCommunity property
At the first spouse’s death, both halves of community property can receive a new basis (IRC §1014(b)(6)).
Worth settling early in Homewood.
- Basis planning
- Keep the step-up where it matters most.
- Gift strategy
- Use the annual exclusion deliberately.
- Property tax review
- Plan for Proposition 19 before a transfer.
More for Homewood families.
Estate PlanningWills, trusts, powers of attorney and health care directives drafted to work together.
Living TrustsRevocable trusts that keep funded assets out of probate and under your control.
Trust AdministrationTrustee guidance through notices, inventory, taxes, accountings and distribution.
ProbateCourt-supervised administration for assets left outside a trust.
Small Estate AdministrationSimplified California procedures for estates under the statutory limit.
Conservatorship & GuardianshipCourt-supervised protection for adults and minors, and the alternatives to consider first.
Asset ProtectionLawful structures that reduce avoidable exposure for personal and business assets.
Estate Tax PlanningFederal estate tax, portability and transfer planning for larger estates.
Business SuccessionOwnership and leadership transitions written into your estate plan.
All practice areasEstate planning, trusts, probate, tax and protective proceedings.
Tax Planning in other communities: TruckeeTahoe CityKings BeachSierraville See all areas served
In clients’ own words.
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This testimonial or endorsement does not constitute a guarantee, warranty, or prediction regarding the outcome of your legal matter.
Frequently asked questions
Questions from Homewood families.
- Does California have an estate or inheritance tax?
- No. California does not impose an estate, inheritance or gift tax. The federal estate tax applies only above $15 million per person in 2026.
- Will my heirs pay capital gains tax on my Homewood home?
- Usually only on growth after your death, because inherited property generally takes a basis equal to its value at death. A sale soon after death often produces little taxable gain.
- Should I add my children to the title of my house?
- Adding a child to title is a gift that can carry over your original basis for that share and expose the home to the child’s creditors. A trust usually reaches the goal with fewer side effects.
- Can tax planning be coordinated with my accountant?
- Yes. Planning decisions work best when your attorney and your tax professional are working from the same information.
- How does Proposition 19 affect an inherited second home?
- A cabin or second home that is not the child’s principal residence is reassessed to market value when it transfers, which can raise the property tax substantially.
From Homewood to a plan you can rely on.
From Homewood, take State Route 89 north through Tahoe City to our office at 10270 Donner Pass Road, Truckee, CA 96161. If the drive is difficult, ask about meeting arrangements when you call.