I received approximately $7K this year as my portion of sale of property from my father's estate. The estate attorney says I am responsible for figuring out if I owe tax

[eileen-woodruff]

When the estate return was filed the property was appraised at $24K so taxes were paid on that amount.  In 2017 the property was re-appraised at $30K and sold for that amount.    Do I use Schedule D to figure out if taxes are due on my portion (the 7K I rec'd)?

[Hal_Al · Accepted solution]

The cost basis, on inherited property, is the fair market value (FMV) on the date of death. That was apparently $24,000. If the property was sold for $30,000, the capital gain is $6,000.  That can be adjusted downward for any expenses on the sale.

On your tax return, you report your share of the sale  (apparently $7000) less your share of the cost basis (24,000 divided by the number of heirs) on form 8949,and then schedule D. 

[eileen-woodruff]

Thank you very much!!   I wasn't aware of form 8949 so I will check that out.   Really appreciate the quick response on here.

[eileen-woodruff]

As a follow on question (much later as I am just getting back to this.  I use TurboTax Deluxe and I need to know where I enter this information on the property sale/capital gain.  The menu prompts do not contain anything that I can see about form 8949.

[Hal_Al]

In TurboTax (TT), enter at:
- Federal Taxes tab
 - Wages & Income

Scroll down to:
-Investment Income
   -Stocks, mutual funds, Bonds, Other (Real estate is other)

[eileen-woodruff]

Thank you!  I'll check it out.