My sister and I inherited my mothers home in 2015 and sold it in 2016. How do I report that income. Capital gains? Neither of us lived in the home.

[IreneS · Accepted solution]

UPDATED FOR TAX YEAR 2019

Since neither of you lived in the home, you would report the sale as the sale of an investment.  Because you inherited this property any gain/loss is considered long term. 

To enter this in TurboTax, please follow these steps:

1. Click on Federal > Wages & Income
2. In the Investment Income section click on the Start/Revisit box next to Stocks, Mutual Funds, Bonds, Other.  If you have already entered some investment sales, you will see a screen Here's the investment sales info we have so far.  Click on the Add More Sales link. 
3. If you haven't yet entered some investment sales, you will see a screen Did you sell any investments in 20XX?  Click the Yes box.
4. Answer No on the screen, Did you get a 1099-B or brokerage statement…”
5. On the screen, Choose the type of investment you sold, mark the button for Second Home and click Continue. 
6. On the next screen, enter the land sale information.  Be sure to enter the net proceeds and mark whether income taxes were withheld or not. 
7. Continue through the screens, entering the requested information.

[Edited | 4/10/2020 |  9:06am PDT]