Final answer:
The transferee of assets would receive a basis equal to the fair market value of the assets on the date of transfer in cases of inheritance from a decedent's testamentary trust, by intestate succession, and from a revocable living trust after the grantor's death, which makes options i, iii, and iv correct.
Step-by-step explanation:
The question concerns the basis of assets someone receives either through inheritance or as a gift. When assets are transferred, the basis can either be a carryover basis (the basis the giver had) or a stepped-up basis (the fair market value of the assets at the time of the transfer).
For which of the following sources will the transferee of assets be certain to receive a basis in the assets equal to the asset's fair market value on the date of transfer? The options are: A) From a decedent's testamentary trust, B) By inter vivos gift, C) By intestate succession, D) From a revocable living trust after the grantor has died.
The correct answer is c) i and iii, which are from a decedent's testamentary trust and by intestate succession. In cases of intestate succession and from a testamentary trust established by a decedent, the assets are typically stepped-up to the fair market value at the time of the decedent's death. However, an inter vivos gift usually carries over the basis from the giver to the recipient.