That didn't make sense to me. If this was the scenario, would It be negative to me?
Buys house for $100k
increases in value to $500k and get second mortgage of $300k, (total owed bank $400k)
Person dies and I inherit it and sell it at FMV OF $400k.
I have enough to pay off the mortgage of $400k
Then $400k - $100k = $300k I would owe Capital gains on? I would owe the IRS $30k and lose money on this inheritance?
Greg
