inherited property from spouse's estate

[sc5lewis]

my spouse died intestate in NC and although we were married for 30yrs (as second marriage for both), i was never on the deed to the house i lived in.  NC ruled that  all the estate property, including house, would be split 4 ways (myself and his 3 children from previous marriage). Upon sale of all estate assets, i received my share as well as 2 of the 3 children's share (they both legally transferred their right of inheritance) to me.

Additionally, i receive 1/3 of the other child's  (that child died before my spouse) from those step-grandchildren.

My question is: How do I treat the income received from the other children and grandchildren, which was not from my spouse's estate?  Since my share is inherited directly from the estate, it is not taxable.

any help here??

[KrisD15 · Accepted solution]

I don't see any of the income as taxable for you and you needn't enter the inheritance into the TurboTax program. 

If you received a 1099-S, enter that and select "Inherited" in the TurboTax program. 

As far as the other children, those funds were either also inheritances (since you said they transferred their rights) or gifts. 

Neither an inheritance nor a gift is taxable to the person that received the inheritance or gift. 

Since the property was sold, you do not need to be concerned with basis in the future. 

[sc5lewis]

thanx, final question:  any 1099S received will be for the estate, no me since it was not my asset?

[KrisD15 · Accepted solution]

That would make sense.

Since you were not an owner at closing, you would not get a 1099-S