You are about to sell, or your accountant wants a number for the tax return, and the house was your parents' or your spouse's. What the home was worth on the day the owner passed away usually sets your starting point for any later gain. That value can't be found by looking at the house or at listings today.
Why "step-up" is a loose word
Federal tax law generally sets an heir's basis at fair market value as of the decedent's death (Internal Revenue Code section 1014(a)). If the executor elects the alternate valuation date under section 2032, the value six months after death is used instead, or the value on an earlier sale or distribution date. A basis adjustment can go down as well as up, so "step-up" promises nothing about the tax. Your tax adviser should settle the date and the use before a report is ordered.
The appraisal goes by several names: step-up, date-of-death, retrospective. All mean an opinion of one property's value on a past date, rebuilt from the market of that time.
When a spouse passes: California community property
California is one of the community property states listed in IRS Publication 551. Section 1014(b)(6) adds a rule: at the first spouse's death, the survivor's half also counts as property acquired from the decedent, as long as at least half of the whole community interest was includible in the decedent's gross estate. Publication 551 says the total value of the community property, including the survivor's part, then generally becomes the basis of the entire property, and that the half-includible condition applies whether or not the estate must file a return.
Whether a particular Escondido home is community property depends on the facts. California's rule is summarized on our divorce appraisal page. Confirm with your tax adviser before relying on a full adjustment.
What a retrospective report has to show
The effective date. A report written now can carry a date months or years back. Sales that closed around then, and the conditions of that market, are the core evidence.
The home as it was. The report describes the house on the effective date, not as it stands now.
Records from the time. Later documents can still prove earlier facts, such as a permit showing when a kitchen was redone. Useful items include dated photos, the listing from an earlier sale, inspection or appraisal reports, permits and contractor invoices. The appraiser decides which fit and says how they were used.
The parcel search of the San Diego County Assessor/Recorder/County Clerk shows assessed values and parcel details that can confirm facts about the lot. Treat the tax roll and recorded sales as leads to verify, not as the value on your date.
One Escondido month is not your month
RPR's Sold Listings dataset for the Escondido city boundary reported a median sold price of $890,000 across 76 sold listings for September 2026 (filter: Single Family plus Condo/Townhouse/Apt). Source: Realtors Property Resource, Escondido city market trends, retrieved October 7, 2026.
A basis appraisal for another month or year needs that period's evidence and this home's own features, which a city median can't supply.
The tax side, briefly
The estate tax return and the alternate date
For deaths in 2026, the Form 706 instructions require a return when the gross estate, plus adjusted taxable gifts and specific exemption, is more than $15,000,000, or when the executor elects portability, passing the decedent's unused exclusion amount to the surviving spouse. When a return is filed, real estate is reported at its date-of-death value (or the alternate date if elected), and the instructions ask the executor to explain how values were determined and attach any appraisals. The alternate valuation election is made on that return, can't be revoked, and is allowed only if it lowers both the gross estate and the tax.
California
Voters repealed California's inheritance tax in 1982 (Proposition 6). The State Controller's Office collects it only for deaths before June 8, 1982, and no California estate tax return is required for deaths on or after January 1, 2005.
Federal law has no inheritance tax either, only an estate tax paid by the estate (26 U.S.C. 2001 and 2002). For a U.S. citizen or resident who passes away in 2026, it is possible only where the estate plus certain lifetime gifts runs past $15,000,000. IRS Publication 525 explains that an inheritance is generally not the heir's income, though rent the home earns afterward is. A later sale is generally taxed only on gain above the date-of-death basis this appraisal documents.
Property tax is a separate system
When a parent's Escondido home goes to a child, Proposition 19 can change the property tax, and the San Diego County Assessor handles that claim; the basics are on our estate appraisal page. If the home is in a probate case, the referee's inventory value is a separate step; see probate appraisals.
Your attorney or tax adviser decides the date, the use and the paperwork. An appraisal doesn't settle a tax result, and neither the IRS nor a court is bound to accept it.
How the work goes
- Agree the assignment. We confirm the property, purpose, users, effective date and deadline, then put scope, fee and delivery estimate in writing.
- Assemble the history. When the scope includes an inspection, entry is arranged; either way, you share the dated records you have.
- Rebuild the market. The appraiser analyzes sales from around the effective date and explains the path to the opinion of value.
- Check before you use it. Review the date, intended use and stated assumptions, and report any factual mistake about the home.
The work follows USPAP, the Uniform Standards of Professional Appraisal Practice, which governs method and doesn't make any recipient, including the IRS, accept a report. Digging into an earlier market, the home's size and your deadline all bear on fee and timing, so have availability confirmed before planning around a filing date.
What to send us
- The Escondido address and property type
- The purpose, and your adviser's view on whether the home was community property
- The date of passing, or the alternate date your adviser names
- Your deadline, remodels or repairs since, and any dated records
Call 442-248-3110 or request a retrospective appraisal quote. Related: estate appraisals and probate appraisals.
General information about retrospective appraisals; not tax advice and not a value for any property.