How do I do a capital gains tax for a life estate sold after my mother passed away and the proceeds were split evenly between my brother and I?

[PaulaM · Accepted solution]

Your cost basis for the inherited home is the fair market value (FMV) at the date of her passing. This gives you a stepped up basis in the property. The two of you will each enter your proportionate share of the sales proceeds and FMV on your return.

Enter in the Investment section and choose 'Everything else' for type of investment sold.

Then enter 1/2 of the net proceeds from the sale. Continue on to enter that the property was inherited and the date of your mother's passing, and 1/2 of FMV at the date of her passing . Continue to the gain/loss computation (if any). The sale is reported on schedule D even if the gain is 0.

Note: If you received a 1099-S for the sale be certain that it is for your share only. If not, contact the issuer for a corrected copy.

[blaisdell_b]

I’ve read this but still cannot find the section to input the 1099-S info.  I have the same exact situation as the person who posted the question.  I am usting TTax Premier

[DoninGA]

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@blaisdell_b wrote:

I’ve read this but still cannot find the section to input the 1099-S info.  I have the same exact situation as the person who posted the question.  I am usting TTax Premier

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To enter an investment sale other than from a brokerage account (1099-B), follow the steps below.

Click on Federal Taxes (Personal using Home and Business)
Click on Wages and Income (Personal Income using Home and Business)
Click on I'll choose what I work on (if shown)
Under Investment Income
On Stocks, Cryptocurrency, Mutual Funds, Bonds, Other, click the start or update button

Or enter investment sales in the Search box located in the upper right of the program screen. Click on Jump to investment sales

Using the desktop editions -

On the next screen click on Yes
On the next screen click on Skip import
On the next screen, select Other and continue