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kdove9398
New Member

We have two 1099-S from the sale of a grandfathers house in Virginia. Do we have to pay a inheritance tax on the sale of these two houses? if so where do we enter it?

 
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DianeW
Expert Alumni

We have two 1099-S from the sale of a grandfathers house in Virginia. Do we have to pay a inheritance tax on the sale of these two houses? if so where do we enter it?

An inheritance tax return is a separate issue and may or may not be required in your situation.  

The 1099-S you received should show only your portion of the selling price.  This inherited property would be considered investment property and will be reported on a Schedule D.

Inherited property usually has a stepped up basis which means the basis would be the value on the date of death, as long as there were no transactions prior to death where the property was transferred into any of the children's names by gift or sale.  You would use your share of the basis as your cost when entering the sale. Depending on how quickly the house was sold the basis can likely be the same as the selling price so the gain or loss, if any, will be minimal. This assumes the house was not transferred over to you prior to his death.

In TurboTax (online or desktop)  use these steps after you sign into your account. (upgrade to Turbo Tax Premier will take place)

  • Federal Taxes Tab
  • Wages & Income
  • Scroll to Investment Income
  • Show more
  • Stocks, mutual funds, bonds, other
  • Follow the prompts
  • Type of investment would be "everything else"
  • Description
  • Select Inheritance (important - it's always considered held long term which provides a special tax break)

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1 Reply
DianeW
Expert Alumni

We have two 1099-S from the sale of a grandfathers house in Virginia. Do we have to pay a inheritance tax on the sale of these two houses? if so where do we enter it?

An inheritance tax return is a separate issue and may or may not be required in your situation.  

The 1099-S you received should show only your portion of the selling price.  This inherited property would be considered investment property and will be reported on a Schedule D.

Inherited property usually has a stepped up basis which means the basis would be the value on the date of death, as long as there were no transactions prior to death where the property was transferred into any of the children's names by gift or sale.  You would use your share of the basis as your cost when entering the sale. Depending on how quickly the house was sold the basis can likely be the same as the selling price so the gain or loss, if any, will be minimal. This assumes the house was not transferred over to you prior to his death.

In TurboTax (online or desktop)  use these steps after you sign into your account. (upgrade to Turbo Tax Premier will take place)

  • Federal Taxes Tab
  • Wages & Income
  • Scroll to Investment Income
  • Show more
  • Stocks, mutual funds, bonds, other
  • Follow the prompts
  • Type of investment would be "everything else"
  • Description
  • Select Inheritance (important - it's always considered held long term which provides a special tax break)

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