If an property tax return wasn’t filed, your basis is the appraised worth of the house at the decedent’s date of death for state inheritance or transmission taxes. Figure the part of the federal reward tax paid that’s as a end result of net enhance in value of the home by multiplying the total federal reward tax paid by a fraction. The net improve in the value of the home is its FMV minus the adjusted foundation of the donor. The details are the identical as in Example 1, except this time Andrew sells the house for $90,000. Initially, he …