sale of inherited property

[blueeyestexas]

I apologize for the length of this post but here goes:

My mother was executor on her mothers estate.  She passed before probate was completed and sale of grandmothers property was completed.  After my mother passed my uncle took over probate of grandmothers estate and sold property which was split between four beneficiaries.  I received a check for my portion of the estate and was required to establish an estate, probate my moms estate and they required me to file for an EIN.  Since the sale I have not recieved a 1098 or K-1 from the abstract company, broker, or buyer of said property.  I need to know if i need to file taxes on the monies received.  I live in Texas  Property was sold in Oklahoma  This is the first and only income the estate will have and is valued under $25,000  Help??

[DianeW777]

It depends. If you are the beneficiary of your mother's portion of the estate (formerly your grandmother's)  and this is the reason you received your share of  the proceeds of the sale, you should include the sale on your individual tax return.  See the instructions below and the information about your cost basis.

• Do I need to file a state return? (click on Oklahoma)

There would have been a stepped up basis on the home when it was sold so the fact you received $25,000 doesn't provide your with the inherited value on the date of death which would be your cost basis (your beneficiary share of the cost). 

Your cost basis is the fair market value on the date of death of the decedent, plus the capital improvements (not repairs but improvements that are capital in nature).  The expenses of sale will reduce any gain or increase any loss as well. This is entered as the sale of investment property and can be entered as follows.

Enter the inherited property sale in TurboTax using the steps provided.  

1. Open or continue your return: 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. In TurboTax Online select 'See more' in the FAQ then click 'sold second home'.
2. Under Wages & Income scroll to Stocks, Cryptocurrency, Mutual Funds, Bonds, Other (1099-B)
3. Answer Yes on the Did you sell any stocks, mutual funds, bonds, or other investments in 2024? screen
   • If you land on the Your investment sales summary screen, select Add More Sales
4. On the OK, let's start with one investment type screen, select Other, then Continue
5. On the Tell us more about this sale screen, enter the name of the person or institution that brokered the sale
6. On the next screen, select  Other (choose this also for inherited homes) then select  I inherited it under  How did you receive this investment? (For TurboTax Desktop you can enter a description of 'Inherited Home' and long term holding period).

Estate Return:

It seems there is no reason to file an estate return since there is really no money in the estate based on your comments. As far as Oklahoma is concerned you can click the link below. Most often a nonresident state return is required if you sell property that is situated there. Again, this assumes you must file your individual return since you got your share of the money and it's unclear if an estate return was filed and tax paid already.