Paid from a trust, never got paperwork, Filed an extension

Nobody here will know. You need to talk to a person who is in charge of the trust and/or whoever closed on the house, if the sale was recent. If the trust return is required, it should be filed first before you can receive your K-1.

Short answer: You may or may not need to report this at all, if you do need to report it, it might go on your 2025 return or your 2026 return, and you may or may not need to pay tax on it even if you need to report it. This is a complex situation, and y’all may need to work with a tax professional and/or estate attorney to handle this.

Longer answer:

First question is whether you need to report it. If any of the gain is taxable, then the trust needs to report it. Also, if none of the gain is taxable *but* a 1099-S was issued, then the trust needs to report it. If the trust reports it and doesn’t pay the taxes itself, then the trust has to issue a K-1 to each beneficiary, and you have to include that K-1 with your return.

You need to talk to the trustee (mom?) and get them to look at the terms of the trust to figure out what options the trustee has, and then work with the trustee to choose which option is most beneficial for everyone involved. Again, this is a complex situation, and y’all may need to work with a tax professional and/or estate attorney to handle this.

In general, you only pay tax on the profit from selling something like a house, which is your sale price minus sale expenses minus your “basis”. Your basis is what you paid to buy the house + the cost of any major improvements you made to the house. However, when your father passed, you likely received a step-up in basis for part or all of your share of ownership in the house, meaning part or all of your basis resets to what the house was worth on the day he died, instead of what I listed above. You then would add to your basis after that for any major improvements to the house.

Again, you take the sale price, minus expenses incurred as part of the sale, minus your basis; what’s left is potentially taxable.

Your mom may qualify to exclude some or all of the gain from selling her share of the house, because she lived in it herself, but if you didn’t live in it for at least two of the five years preceding the sale, that exclusion won’t apply to you. The trust might interfere with that provision for her to exclude gain; it depends how the trust is structured, but again, it doesn’t impact *your* situation.

If the trust doesn’t pay the tax on your portion and distributes it to you, then it has to send you a K-1. Depending on further details, the trust *may* be able to use a fiscal year, which could result in a sale during 2025 being reported to you with a 2026 K-1 and going on your 2026 return. *Most* of the time, trusts don’t use fiscal years, and a 2025 sale will be reported on a 2025 K-1 and your 2025 return.

If distributed to you, your portion of the sale should be considered a long-term capital gain. Depending on your income and filing status, the profit may be taxed at 0%, 15%, or 20%.

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I highly recommend preparing the rest of your return just to see whether you owe the IRS or are due a refund. If you owe, make a payment for the amount that you owe immediately, to minimize the late payment penalty & interest. Get the sale of home stuff straightened out, and file your return once you do; remember to include any payments that you’ve already made on your 2025 taxes when you file your full return, and if you do owe tax on the home sale, expect to pay late penalties on that amount. (An extension gives you additional time to file, *not* additional time to pay.)