IRS Used Wrong Basis to Assess Capital Gains of Inherited Stock

A man whose mother died urged a federal court Thursday to order the IRS to accept his 2006 amended tax return because the agency assessed an almost $81,500 tax bill by incorrectly valuing stock he had inherited and later sold.

The IRS must accept as timely filed Henry L. Compter’s amended 2006 IRS Form 1040 showing the value his stock at the time of his mother’s 2004 death, Compter said in a complaint filed with the US District Court for the Northern District of Ohio. The agency should accept the return because it should’ve have been aware that the stocks ...