Inherited/gifted home

[Lindysue]

My brother and I inherited our family home after mom passed away in 2013. Both names were on quit claim deed (50/50). I took my name off deed in 2020 to leave home exclusively in brothers name. He became terminally ill in December 2022 and signed quit claim deed back to both myself and his ex-wife (50/50) at that time.  He passed away in July of 2023 and we subsequently sold the house last October for $155,000.  SEV in 2013 was $20,000 and $44,900 in 2022 per township records.

It was suggested that I need to claim 50% from when mom died and home was inherited, and then 25% when home was gifted prior to brothers death.

Any ideas how/where to enter this as capital gains?  Thanks so much!

[AmyC]

An inheritance gives you a basis in the property based on the deceased passing. A quit claim deed does not. You did not inherit the house since there was a quit claim deed. Whatever basis your mother had in the house, you get half of that when she gave it to you.

Example: Let's say she bought the house for $30k. Your basis is  $15k from mom.

2022 you gave your brother your basis.

Dec 2022 - your brother gave you half of his basis. He had $15k from mom + 15k from you for a total basis of $30k in the house.

If only the two of you were on the quit claim from mom, you are back to your basis from mom, $15k.

[Lindysue]

Clarificaton on previous post/question. When mom passed away in 2013, house was left to my brother and myself in her will, so quit claim deed was done prior to her death (sorry). Home originally purchased in 1953 for $10,000.  Thank you for any help in clarifying how to claim with this additional information.

[SusanY1]

Since the quit claim was made prior to your mother's death, you have a gift and not an inheritance for purposes of determining your basis.  This would make the basis calculation work as described in AmyC's prior answer.  

For it to be an inheritance, it would have to pass to you through the probate process with the deed transfer done by the executor/personal representative of the estate after your mother's death.