A long held investment takes fair market value basis, capped at 30 years
What the document says“in the case of an investment sold before the date that is 30 years after the date of the investment, the fair market value of such investment on the date such investment is sold or exchanged, or”
The section rewrites section 1400Z-2(c) of the Internal Revenue Code of 1986 so that where the taxpayer elects, the basis of the investment is its fair market value on the date it is sold, if sold within 30 years of the investment, and otherwise its fair market value on the date 30 years after the investment.
What the document actually says“in the case of an investment sold before the date that is 30 years after the date of the investment, the fair market value of such investment on the date such investment is sold or exchanged, or”
The basis is the value on the day of sale. That is for an investment sold within 30 years.
A basis equal to market value leaves no gain to tax. If the investment is held longer, the value at 30 years is used. The taxpayer must elect this.
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