Sale of a inherited house

My mother passed away and we sold her house and per the will the money was split 3 ways. So my questions are.

1. Are these funds reportable on taxes sense they are from an inheritance.  We did get an 1099-S from the title company.

2. If so where in TurboTax deluxe do I enter this amount.  We did take a loss on the house and did get an K-1 from the estate taxes filed. 

Mike