Self employed
Yes, you must pay tax on the gain for federal income tax purposes. It would help if you could clarify how you acquired the property and what it was used for before the sale. If it was not inherited you can please add additional comments and one of our tax experts are here to help.
The steps below will explain how to handle inherited property and you would use your 1/4 for the sales price, and potentially the cost basis and selling expenses.
Inherited property that is sold is ALWAYS considered with the long term holding period regardless of when it was inherited. This allows the capital gain tax rates for any gain, which is lower then regular tax rates.
The sale of inherited property can be entered using the following instructions.
- Open or continue your return (you can choose the Search box and type 'sale of second home' then use the Jump to link to enter your inherited sale) or follow the menu.
- Under Wages & Income scroll to Stocks, Cryptocurrency, Mutual Funds, Bonds, Other (1099-B)
- Answer Yes on the Did you sell any stocks, mutual funds, bonds, or other investments in 2021? screen
- If you land on the Your investment sales summary screen, select Add More Sales
- On the OK, let's start with one investment type screen, select Other, then Continue
- On the Tell us more about this sale screen, enter the name of the person or institution that brokered the sale
- On the next screen, select Other (choose this also for inherited homes) then select I inherited it under How did you receive this investment?
