If you received your whole house as a part of your divorce settlement, this is
called a "transfer incident to divorce" and is not a tax event which
changes your basis in the house. As you received both you and your
spouse's share of the home, you are entitled to both basis amounts. This
is based on the cost to purchase the home plus any improvements to the
home prior to the divorce paid by both of you. You can also add to cost
basis any amounts that you paid on your own to improve your home after
the divorce.
You also need to consider whether you and/or
your spouse have used any part of the property for rental or business
use and taken depreciation on the home. The depreciation taken is
subtracted from your cost basis. This depreciation amount may be subject
to additional tax calculations and special rules.
Upon the sale of the home as the person who owns 100 % of the house, you would only receive a $250,000 exclusion for the sale of your primary residence.
If however, the sale of the home is a joint sale of a primary residence, then each of you should split the sale and record 1/2 of the sale on each return. Then each of you would have your own $250,000 exclusion to declare.
CAUTION: If you look at the Form 1099S, you will see what was reported to the IRS regarding this sale. The social security number and name on the Form 1099S is only yours, the IRS will expect to see the total amount of the sale on your return. You may have to send them additional documents to show the joint ownership at the sale date.
I am giving you a link to the IRS Publication 551, Basis of assets.
www.irs.gov/uac/About-Publication-551
This other link will get you to the IRS Publication 504, Divorced or Separated Individuals.
www.irs.gov/publications/p504
I hope this helps you calculate your return correctly. Thanks for using Turbo Tax.
