Disposition by death
If an interest in the activity is transferred by reason of the death of the taxpayer—
(A)#
paragraph (1)(A) shall apply to losses described in paragraph (1)(A) to the extent such losses are greater than the excess (if any) of—
(i) the basis of such property in the hands of the transferee, over
(ii) the adjusted basis of such property immediately before the death of the taxpayer, and
(A)(i)#
the basis of such property in the hands of the transferee, over
(A)(ii)#
the adjusted basis of such property immediately before the death of the taxpayer, and
(B)#
any losses to the extent of the excess described in subparagraph (A) shall not be allowed as a deduction for any taxable year.