You must first determine your basis in the property.
- The basis of property inherited from a decedent is generally one of the following:
- The fair market value (FMV) of the property on the date of the decedent's death
- The FMV of the property on the alternate valuation date, but only if the executor of the estate files an estate tax return (Form 706) and elects to use the alternate valuation on that return. See the Instructions for Form 706.
Is money received from the sale of inherited property considered taxable income?
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