As the Administrator of my father’s estate and I’m
putting his house on the market very soon. The house was only in my father’s name but per his Will, my stepmother will get half of the proceeds and my brother and I will split evenly the remaining half. How is this handled as far as taxes are concerned once the house has sold? I’m assuming I will only have to claim my portion but how is it filed? There is no mortgage on the home, for additional info. Thanks
Posted by Karizma-16
2 Comments
Normal operation in the US is that you report the *gain* relative to the date of your father’s death. That’s called a stepped-up basis. Mention to your real estate agent that you need that appraisal.
Sorry for your loss! If sold soon after death, inherited houses almost always create a capital loss. The estate gets a step up in basis to fair market value, which changes little in the few months before they usually sell. Then, the realtor commissions, title fees, etc, drive the transaction into a loss. Heirs receive their share of the proceeds, but on their tax returns they only report their share of the gain or loss.