Deductions & credits

The proceeds from the sale of the inherited home are taxable income.  When figuring the basis of the home, you normally use the value of the house on the day the descendent passed away.  That ais called a "stepped up value".   You will add the value of the home, plus any improvements you made before selling it, and any costs of the sale.

 

Here are the directions to enter the sale in TurboTax.