The concept of a new basis at death1 has been enormously advantageous to the agricultural sector and to the country generally in avoiding the “lock-in” effect that would occur if heirs were confronted with large income tax liability on the sale or other taxable disposition of inherited property. As is widely known, the loss of a new basis at death became reality after December 31, 2009, with a carryover basis implemented (although further Congressional action in 2010 is anticipated which would likely restore the rule of a new income tax basis at death).2 However, the concept of “income-in-respect of decedent” has denied a new basis to that category of property in the past and is almost certain to continue to do so in the future.3



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