Ask an AI Accountant

A free tool by

i received a stock payout from my grandfather who passed away last year, how do i report it and what do i use for the basis?
AI accountant’s answer:
I'm sorry to hear about your grandfather's passing. When you inherit stocks, the cost basis is usually "stepped-up" to the fair market value on the date of your grandfather's death. To report the stock payout, you'll need to include it in your tax return when you sell the inherited stocks. When you sell the stocks, here's what you need to do: 1. Report the transaction on Form 8949, Sales and Other Dispositions of Capital Assets. 2. Include the date you sold the stocks, the sale price, and the stepped-up cost basis. 3. The difference between the sale price and the stepped-up cost basis will result in either a capital gain or loss. 4. Transfer the information from Form 8949 to Schedule D (Form 1040), Capital Gains and Losses. 5. Include the result from Schedule D on your Form 1040, U.S. Individual Income Tax Return. Remember to keep records of the fair market value of the stocks on the date of your grandfather's death and any other relevant information to calculate the stepped-up basis accurately.
Not Correct.
Icon check
Looks good

Keeper’s AI Accountant

This AI accountant is powered by GPT-4, but has up-to-date knowledge of tax law. It’s been trained on federal and state tax updates for 2023. With credentialed tax professionals fact-checking its responses, it applies IRS rules to real-world situations.

Estimate tax saving

Track and claim every eligible deduction with Keeper

Keeper is the top-rated all-in-one business expense tracker, tax filing service, and personal accountant.