Safe Disclaimers in Cross-Border Talks: What to Say About Step-Up in Basis Without Giving Tax Advice

Step 1: Core concept in plain English—what “step-up in basis” is and why it matters in cross-border contexts (without advising)

The term “step-up in basis” describes a change in the tax cost of an asset at the time of inheritance. In simple terms, the “basis” is the starting number used to calculate taxable gain if the asset is later sold. A “step-up” means the basis is adjusted to the asset’s fair market value at a specific moment—usually the date of the original owner’s death—rather than remaining at the original purchase price. If an heir later sells the asset, the gain (price received minus basis) may be smaller than it would have been without that upward adjustment. This is a general, widely used definition that helps clients understand the idea without telling them what to do.

In cross-border situations, the concept gains complexity because tax rules vary by country and may interact in unexpected ways. Some jurisdictions provide a step-up at death for local tax purposes; others do not. Some align the timing and valuation approach with international norms; others apply different dates, elections, or exceptions. When clients hold assets in multiple countries—such as real estate in one jurisdiction and a portfolio in another—the way basis is determined may differ from asset to asset, and from country to country. This can influence what taxes are recognized, when they might be recognized, and by whom. The key point for a client-friendly explanation is that “step-up in basis” is about how the starting point for tax gain is set after someone passes, and that this starting point can differ in cross-border contexts.

It is also helpful to keep the language neutral and factual. You can say that a step-up, if available under the applicable rules, may reduce future taxable gain compared to using the original purchase price. You are not guaranteeing an outcome, and you are not telling the client to take any action. You are explaining a mechanism. In a cross-border setting, you can note that different countries may: define basis differently; treat the same asset differently; or apply special rules for residents, nonresidents, trusts, or estates. These differences can affect planning considerations, but you should not draw conclusions or recommend strategies unless you have the proper engagement and expertise. The goal here is clarity: define the term, signal that it is jurisdiction-dependent, and emphasize that precise outcomes rely on local law and the client’s specific facts.

When high-net-worth clients ask about step-up in basis, they often have a mix of assets (for example, operating businesses, private equity interests, or properties) and family members spread across jurisdictions. Without giving advice, you can explain that the availability and measurement of a step-up may depend on where the asset is located, where the owner was taxed as a resident, and how the estate or succession is structured. You can also note that timing matters. Valuation dates, death dates, and filing deadlines can affect which values are recognized for basis purposes. Keeping the explanation focused on these general mechanics allows you to educate the client without guiding their decisions.

Step 2: The advice boundary—how to keep explanations educational (general, factual, non-actionable) and identify when a question becomes advice

The safest way to stay on the educational side is to use general, factual statements and avoid tailored instructions. Educational language describes what a concept is, where it might be relevant in broad terms, and what kinds of variables typically influence outcomes. Advisory language, by contrast, applies those concepts directly to a client’s particular facts and suggests actions, structures, or decisions. The difference often comes down to specificity, directives, and predictions.

Keep your explanations general by focusing on: definitions, common patterns across jurisdictions, typical variables (such as residency, asset location, and valuation timing), and the importance of formal advice for specific decisions. Avoid promising results or implying that one approach will “work” for a specific client. Avoid deciding “what they should do” based on partial information. The moment you begin connecting the client’s personal facts with specific outcomes, you risk crossing into advice. Even statements that sound harmless, such as “In your case, you would likely get a step-up,” may be advisory because they apply a legal conclusion to the client’s facts.

Red flags that indicate a question is shifting into advice include:

• The client asks whether their asset will qualify for a step-up in a particular country.
• The client wants to know exactly how much tax would be due if they sell after an inheritance.
• The client asks what structure to use—trusts, holding companies, or specific estate arrangements—to secure a step-up.
• The client requests a timeline or filing checklist particular to their situation without a formal engagement.
• The client provides detailed facts and asks you to confirm a specific tax result.

When any of these red flags appear, pivot to a safe boundary statement. Explain that their question requires individualized analysis under the laws of the relevant jurisdictions and that you can coordinate with qualified tax counsel or begin a formal engagement to address their facts. Keeping your tone professional and helpful is essential; you are not refusing to help, but you are re-scoping the conversation to maintain compliance.

Another way to monitor the boundary is to check three elements in your own statements: scope, authority, and actionability. Scope refers to whether you are speaking about general principles or specific client facts. Authority refers to whether you have the professional capacity and engagement terms to give tax advice across the jurisdictions in question. Actionability refers to whether your words direct the client to take a particular step that could have legal or financial consequences. If your statements are broad in scope, do not assert cross-border authority, and remain non-actionable, you are likely within an educational framework. If any of those elements start to narrow or intensify, pause and reposition.

Step 3: Safe language toolkit—ready-to-use, compliant disclaimers and coordination phrases tailored to step-up in basis scenarios

When discussing step-up in basis with high-net-worth clients, reliable phrasing helps you stay clear, accurate, and compliant. The following language illustrates how to maintain a neutral, non-advisory tone while signaling next steps for proper analysis.

• Definition framing: “In general terms, ‘step-up in basis’ refers to adjusting the tax cost of an inherited asset to its fair market value as of a particular date, often the date of death. The effect, if applicable under local law, is to change the starting point used to calculate gain if the asset is later sold.”

• Jurisdictional variability: “The availability and measurement of a step-up depend on the tax rules of the relevant country or countries, and those rules can differ for residents, nonresidents, and different asset types.”

• Non-advisory scope: “I’m providing general information to explain the concept. I’m not giving tax advice or applying these rules to your specific situation.”

• Boundary signal: “To determine how these rules apply to your facts, we would need a formal engagement and coordination with qualified tax advisors in the relevant jurisdictions.”

• Neutral implications: “Where a step-up applies, it can affect the calculation of future gain on a later sale. Where it does not apply, the original cost basis or another rule may govern. The result varies by jurisdiction and circumstances.”

• Records and valuation caution: “Valuation methods and required documentation can be specific to each country’s rules. Confirming the relevant date and valuation process is part of a formal analysis.”

• Cross-border coordination: “Because you have assets and connections in more than one jurisdiction, the interaction of those systems is important. We can coordinate with local counsel to confirm how basis would be determined in each location.”

• Decision deferral: “I’m not recommending any structure or transaction here. If you’d like, we can set up a scoped project to explore options with the appropriate advisors.”

• Written disclaimer for follow-ups: “This communication provides general information for discussion purposes only and does not constitute tax, legal, or accounting advice. Application of these concepts depends on specific facts and the laws of one or more jurisdictions. We recommend consulting qualified advisors before making decisions.”

• Engagement invitation: “If you’d like tailored guidance, we can prepare an engagement that defines the jurisdictions, scope of analysis, and deliverables, and we will involve the appropriate cross-border tax counsel.”

Use these phrases consistently to protect both the client and your firm. They communicate respect for legal boundaries, signal the need for proper analysis, and still help the client feel informed and supported. When the conversation becomes detailed—mentioning specific assets, residency histories, or filing years—repeat the boundary language and offer to coordinate the next step. Consistency reinforces credibility and compliance.

Step 4: Guided practice—mini dialogues and a short checklist to apply the script in real conversations

A practical structure keeps conversations focused and compliant. The following four-part flow—orient, educate neutrally, disclaim and scope, coordinate next steps—helps you manage expectations while delivering clear information.

• Orient: Open by clarifying the topic and purpose. You might say you will explain the concept at a high level so the client can understand the terms that often appear in cross-border estate discussions. This sets a neutral tone and signals that the conversation is informational.

• Educate neutrally: Provide the general definition of step-up in basis and note that rules vary by jurisdiction and asset class. Mention common variables—such as residency, situs of assets, and valuation timing—without diagnosing the client’s situation. Keep verbs neutral: “can,” “may,” “depends,” and “varies by jurisdiction.”

• Disclaim and scope: Insert explicit language that you are not giving tax advice and that applying the rules to the client’s facts requires a formal engagement and local counsel where appropriate. This both protects the discussion and clarifies what would come next if the client needs tailored answers.

• Coordinate next steps: Offer a concrete, professional path forward: define scope, identify jurisdictions, involve qualified advisors, and outline deliverables. This keeps momentum and demonstrates that you can facilitate the process responsibly.

When following this structure, maintain a steady, client-friendly tone. Avoid legal jargon where possible and define terms when you must use them. If the client moves toward fact patterns—“What happens if we sell the apartment in Country X right after inheriting?”—acknowledge the importance of the question, reiterate the boundary, and suggest turning the question into a scoped advisory request. Clients often appreciate the clarity of knowing where education ends and advice begins.

To keep yourself consistent, use a simple, repeatable checklist before, during, and after the conversation:

• Before: Know the definition of step-up in basis in plain English; prepare neutral wording on jurisdictional variability; have your disclaimer and engagement language ready; confirm whether you are authorized to advise in any relevant jurisdictions.
• During: Stay in general, factual mode; avoid using the client’s specific facts to predict outcomes; watch for red flags; state your disclaimer clearly; offer to coordinate advisory support.
• After: Send a brief follow-up summarizing the general concepts discussed, include a written disclaimer, and outline proposed next steps for a formal engagement if the client wants tailored advice.

This repeatable flow helps client-facing professionals communicate complex concepts with confidence and clarity. It protects against accidental advice and maintains a helpful, service-oriented posture. The client leaves the conversation understanding what “step-up in basis” means, why it can be relevant in cross-border situations, and how to proceed if they want answers tailored to their unique profile.

Above all, the goal is to combine clarity with compliance. You can be informative without being directive, and you can be responsive without taking on unnecessary risk. By explaining the concept plainly, marking the boundary between education and advice, using safe language consistently, and offering a structured path to coordinated next steps, you empower clients to understand the landscape while ensuring that any personalized analysis happens under the right engagement and with the right experts involved.