Capital gains exemption

[tagteam]

Also note the Medicare surtax of 3.8% (i.e., the NIIT).

https://www.irs.gov/individuals/net-investment-income-tax

[MrDeanSp]

Some more info I found out today. In 1997 the transfer between my grandmother and mother was done with a bargain and sale deed. Not sure if that affects the basis.

[tagteam]

The type of deed really does not matter in the least.

What's critically important is whether or not your mother paid any consideration to your grandmother for the property (i.e., whether she paid FMV, paid less than FMV, or was gifted the entire property paying nothing).