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You inherited the home in 2022 and sold the home in December 2022.  Generally, you inherit property at the fair market value on the date of death.

Report the sale on IRS form 8949 / Schedule D Capital Gains and Losses.

As an example, your mother may have purchased the unit for $40,000.  On the date of death, the unit may have been worth $50,000 and you sold the unit for $50,000.  Assume realtor commissions of $2,000.

Each of you would report the $25,000 sale, less $25,000 cost basis less $1,000 selling expenses equals long-term capital loss of $1,000.

Please follow these directions to enter the sale:

• Down the left side of the screen, click Federal.
• Down the left side of the screen, click Wages & Income.
• Scroll down to Investments and Savings.  Click Show more.
• Click Start/Revisit to the right of Stocks, mutual funds, bonds, other.
• At the screen Your investments and savings, click Add investments.
• At the screen Let's import your tax info, click Enter a different way.
• At the screen OK, let's start with one investment type, select Other.  Click Continue.
• Enter the sale information.

Per IRS Publication 551 (page 10), the basis of property inherited from a decedent is generally one of the following:

1. The fair market value (FMV) of the property at the date of the individual's death.
2. The fair market value (FMV) on the alternate valuation date if the personal representative for the estate chooses to use alternate valuation. 
3. The value under the special-use valuation method for real property used in farming or a closely held business if chosen for estate tax purposes. 
4. The decedent's adjusted basis in land to the extent of the value excluded from the decedent's taxable estate as a qualified conservation easement.

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