My mother did a quit claim deed to my sister and I for her home.She died in September and we sold the home in November. What tax (if any) do I claim and how do I claim it

markogreenbay — Sat, 01 Jun 2019 02:08:17 GMT

Possibly a bunch of tax. Gifting the house is just about...

Opus 17 — Sat, 01 Jun 2019 02:08:18 GMT

Possibly a bunch of tax. Gifting the house is just about the worst way to transfer property to children, from a tax point of view.

By your mother giving you the house, she also gave you her cost basis. If you sold the house for more than the cost basis, the difference is taxable capital gains. If you had inherited the house, you would have inherited a cost basis at current value and owed no tax.

So you need to document your mother's cost basis. Her cost basis is what she paid for the house originally, however recent or long ago that was. The cost basis is increased by the cost of any permanent improvements or renovations that were made. You can also increase the cost basis by certain closing costs from the purchase or refinancing. You must reduce the cost basis by the amount of depreciation claimed if the home was used for the home office deduction or used in business some other way.

If she owned it with a spouse, then she inherited a partial stepped up basis when the spouse died.

You need to document the cost basis as best you can. Original purchase price can be found in county records. If she got a step up in basis when her spouse died, you will need an appraisal as of that date, a local appraiser can do a retroactive appraisal for you. Costs of improvements will be harder to document if she didn't save the records. Make the best effort you can to establish the cost basis.

If you are audited, the IRS will not give you any cost basis you can't prove.

In turbotax this would be reported as the sale of an asset, not sale of your home.

topic My mother did a quit claim deed to my sister and I for her home.She died in September and we sold the home in November. What tax (if any) do I claim and how do I claim it in Deductions & credits

My mother did a quit claim deed to my sister and I for her home.She died in September and we sold the home in November. What tax (if any) do I claim and how do I claim it

Possibly a bunch of tax. Gifting the house is just about...