Sale of Inherited property(home)

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  • Sherill
    Member
    • Feb 2006
    • 39

    #1

    Sale of Inherited property(home)

    I understand inherited prop is not taxable, but... what happens when the property is sold by the heirs?
    Basis (FMV) at death($80,000)
    Selling price if $100,000.
    Capital gain tax ?? = $20,000
    If there are four(4) heirs, then does the capital gain get prorated for each heir? ($5,000)
    Thank you.
  • Jiggers
    Senior Member
    • Sep 2005
    • 1973

    #2
    Sale of inherited property

    Originally posted by Sherill
    I understand inherited prop is not taxable, but... what happens when the property is sold by the heirs?
    Basis (FMV) at death($80,000)
    Selling price if $100,000.
    Capital gain tax ?? = $20,000
    If there are four(4) heirs, then does the capital gain get prorated for each heir? ($5,000)
    Thank you.

    Each heir will report their share of the sale, less their share of the inherited basis, less their share of the selling expenses (survey, commissions, etc.). This will be considered a long-term capital gain.
    Jiggers, EA

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