Thank You Opus 17 for the reply!
The parents lived in Illinois which I believe is NOT a community property state.
2016 Depreciation - cannot find tax filing, cannot download from their IRS account as it is too old.
Son did not live in the home other than during vacations.
The Quit Claim Deed was given to the son specifically with the understanding that Father would be able to live there indefinitely with his wife, which is documented in his Will. So it appears the Son has an "Implied Life Estate" as you stated (wow, never heard of this before- very informative)
Per your feedback: So Mom's basis is half the cost in 1999, plus half the cost of improvements plus half the FMV from April 2023 (stepped up basis when Dad passed), minus Dad's accumulated depreciation. Mom did sell within 2 years of Dad's death and did not remarry so the remaining gain is covered by the Full $500k exclusion.
Regarding entries into Turbo Tax : At the time of sale, Mom and son received 45.3% and 54.7% of proceeds respectively to separate bank accounts to mitigate wire xfer risk. 2024 Substitute Form 1099-S (emailed by Title Company upon request) shows Son and Mom's name under "Transferor's Name and Address", only son's SSN in the "Transferor's ID number" box. But both names and SSN's are shown on the "Seller's Certification(s) for No 1099-S" with the share of proceeds received and Six Seller Assurance questions each.
Given the latest facts, would IRS be confused if "entire selling proceeds were reported on wife/mom's tax return"? Does son need to enter any info/reference at all regarding this transaction on his joint return with his wife?
Thank You So Much!!!
