Partner's basis after wife's death

[mbigelow]

TP and his brother hold commercial property in a partnership- they are the only members of the partnership. TP's spouse died in 2017. All this takes place in a community property state. Question: does TP receive a step-up basis for his share of ownership in the partnership. The property has increased significantly since purchase. Any help during this busy time is much appreciated. Thank you.

[Maribeth]

Yes, the surviving spouse gets a stepped-up basis in the partnership. His outside basis, not his inside basis. Along with all the other assets held by the marital community -- can also be a stepped-down basis.