Pre-1984 Divorce and CA basis - Spidell

Pre-1984 Divorce and CA basis

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Message Board Pre-1984 Divorce and CA basis

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    • #184094
      Jerry Lopatin
      Participant

      I have a client who divorced in 1981, prior to the enactment of IRC 1041 in 1984, and received the marital house.  As a result, she receives a step-up in basis under Federal law, equal to the increase in value taxed by the transfer of the house from her ex-spouse.

      However, what is the correct California treatment?  Did CA follow the 1962 US Supreme Court ruling US v. Davis, making inter-spouse transfers taxable until IRC 1041 was enacted?   It seems like it is ancient history, and hard to research.

      Thanks

    • #184144
      Lynn Freer
      Participant

      Hi Jerry,

      I went through the old forms and instructions for 1984 and 1985. There is discussion of difference in basis for inherited property but nothing about property acquired in a divorce. The code was redone after the 1986 act and I don’t have immediate access to it. You could post a question on the FTB’s website – ask a legal expert. But if it were me, I’d pick up the federal numbers as I can’t find anything to indicate there is a difference.

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