USA 754 election upon death of LLC member

[DavidCPA in San Jose]

I have a family LLC consisting of a father, a son and his wife, and three adult grandchildren. The father's interest was about 68% of the LLC, with the others divided equally. The father passed away in 2013, and bequeathed his interest in the LLC to the son. The son disclaimed a sufficient amount of the inherited membership interest to re-equalize the remaining members at 20% each. The LLC assets consist of commercial real estate. The property value has increased between the time that the LLC was formed and the date of death (DoD) such that even with the discounted appraised value for a partial interest, there was a significant step-up in the outside basis of the father's interest. I believe it makes sense to make a Sec. 754 election to increase the inside basis with regard to the bequeathed portion, as there will be one parcel sold within a few months and this would reduce the capital gain on the sale by about $120k. It is my understanding that since the father's interest wound up being re-distributed (via effective bequest) equally to the remaining members, the benefits of the 754 election would follow in equal manner, and there would be no discrepancy between the new inside basis of the remaining members. Due to the nature of the family LLC, it is quite possible that a membership interest will never transfer outside of the existing family members.

My question are these: Does this sound like the correct treatment of the 754 election allocation, and are they allowed to make a 754 election, even if there is no "new member", simply due to the fact that the transfer is a result of the death of the father, and his bequest back to the existing members?