Life Estate inherited with tenant and sold soon after.

Forum|Forum|5 years ago
March 15, 2021
1 reply
9 views

My mother died on August 11. My sister and I inherited a condo that was set up in a life estate. We sold the condo two and a half months later. What makes this more confusing for me, is that the condo was rented. I received two months rent out of which I paid the monthly maintenance fee, electricity, and a repair. The rent came from the county to me as Covid assistance so I have a 1099. There were also closing costs. How do I record this in Turbo tax? Do I have to set up a whole Schedule E (or whatever) as a rental property or can I add the rent income and expenses simply in the same section as the inheritance and sale. Thank you.

Not A Product Question

ColeenD3

Level 15

Yes, you must enter the rental information, income, expenses, depreciation, etc on Schedule E. If the property was rented at all in the year of sale, you can also enter all the sales information there. Here are some of the screenshots you would encounter. You can mark it as an inheritance.

Landlady JAuthor

Level 2

Thank you for your reply. I am using TT Home and Business 2020. I am having a hard time finding the screen where I say it is an inheritance. Since it was rented for two months, I also have to put it in as a rental in Schedule E. What step do I take first, second, etc to get this inheritance recorded, sold, and closing cost expenses logged? I may give up.

ColeenD3

Level 15

First enter it in the rental section. Home and Business has a different screen. You will be asked to enter the cost. When you click on the Learn More, you will see this message on the screen, among others. You will do your own calculations and enter the amount.

How to determine the cost of:

Inherited property
The cost is the fair market value of the item on the date of death of the person you inherited it from, or the alternate valuation date (the date the executor of the deceased person's estate can choose to have the property in the estate valued)

Gift property
The cost is the same as the adjusted basis for the person who gave you the item as a gift.