Hello there,
There are three steps to calculate your gain on the sale:
- You will need to convert the fair market value of the inherited property to US dollars using the rate at the time of death to get the value of the inheritance in US dollars.
- You will then need to convert the sales proceeds and any related selling expenses to US dollars using the rate on the date of sale. This will give you the net proceeds from the sale in US dollars.
- Your gain will be calculated by subtracting the fair market value at the time of death (plus the cost of any other improvements you may have made) in US dollars as determined in step1 from the net sales proceeds in US dollars as determined in step 2.
Turbo Tax will interview will guide you through the process to claim the foreign tax credit. You will need to have the details of the taxes paid, and you will need to convert the amount to US dollars using the rate of exchange on the date of the payment.
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