Need advice w/ regards to filing tax for real estate proceeds. Here's the scenario (the $# are just for reference):
Property purchased 30yrs ago in the amount of 250000. Home title belonged to mom and dad
Then 20yrs ago mom and dad added my name and my spouse' to the title (mom & dad holds 50%, we hold 50%)
Dad passed away 5yrs ago (value of home was around 1270000.
Mom decides she no longer wants her name on the title and decied to give all her share of the home to us (3yrs ago / home value was around 1310000)... so from then onwards the title was changed to just 2 named owners (me and my spouse)
Few months ago home was sold for 1200000.
We file tax 'joint' as married couples w/ 1 dependant (our son). We've been living in this 'sold' home for over 30yrs before we moved to another location.
Heard over the lifetime, parents can give to children up to 13.6million$ tax free. Primary resident living over 1yr or more qualifies for 250000 exemption, hence both of us gets up to 500000 exemption.
When we file for tax, how much approximately capital gain tax do we owe (Fed and State)? How do we calculate it? We reside in California
