If I transfer my mothers house that is currently in a trust to myself, will i have to pay any tax since $250,000 of the profit not taxable?

[john14verse6]

My mother died July 2 2024. Her house is in a trust.  My sister and I are the beneficiaries' of all the trust assets.

Should we sell the house while it is still in the trust and pay capital gains tax on it, or should we take outright ownership of it and sell it as individuals?

[dmertz · Accepted solution]

There is no $250,000 exclusion under these circumstances.  Assuming that the trust is a grantor trust such as a trust that was revocable while your mother was alive, the property received a step-up in basis upon the death of your mother.  Whether sold within the trust or sold after distribution from the trust, the taxable amount is the amount by which the value exceeds the adjusted basis.

[john14verse6]

ok gotcha thank you !