If you split the equity, then you would split the cost basis as well. The cost basis would be split as well. The cost basis includes the price you paid for the house, improvements and such after you bought the house. Also any expenses such as realtor fees.
To enter the Sale of a Home select the following:
If you owned and lived in the Home for 2 out of the last 5 years, then you may qualify for the home sale exclusion which would exclude up to $250k ($500k if married filing jointly) of the sale of your home. In order to qualify you must not have used the home sale exclusion in the past 2 years.
If you do not qualify, the rest of your income will play a part in the tax rate. This would be a capital gains sale so your tax rate would be between 0% and 20%. The capital gains rates are as follows based on income