the reason your getting some different answers is because it depends on who is doing the selling and what was done with the house after they dies. was it rented out. did it just sit there.
Sale of decedent's residence. If the estate is the legal owner of a decedent's residence and the personal representative sells it in the course of administration, the tax treatment of gain or loss depends on how the estate holds or uses the former residence. For example, if, as the personal representative, you intend to realize the value of the house through sale, the residence is a capital asset held for investment and gain or loss is capital gain or loss (which may be deductible). (gain or loss = sales price less FMV at date of death less selling expenses) This is the case even though it was the decedent's personal residence and even if you did not rent it out. If, however, the house is not held for business or investment use (for example, if a beneficiary resided in the residence rent-free), and you later decide to sell the residence without first converting it to business or investment use, any gain is capital gain, but a loss is not deductible.
not let's take it one step further and say that the estate is terminated after the sale and all assets including sales proceeds are distributed to the beneficiaries. they should each receive a K-1, which will report the gain or loss on sale as well as any other taxable items such as interest, dividends.
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