You should receive a step up in cost basis since you inherited (a very good reason why just gifting family members assets like houses or stocks is a bad idea - because if it was gifted to you versus inherited you wouldn't get a step-up in cost basis). I'd A) confirm this with a CPA and B) fire your "portfolio manager" because you 1) likely don't need him or her and 2) obviously they are clueless. This is a rather basic, straight forward thing to know.