Transfer on Death Deed Tax Implications

Forum|Forum|5 years ago
March 10, 2021
6 replies
32 views

My Mother passed away in May of 2020 and I acquired her (mortage free) home by a transfer on death deed. I sold the home in September of 2020 for $172,000.00 and divided the proceeds between my 3 siblings and myself. The title company gave me a Proceeds from Real Estate Transaction sheet and an IRS Form 1099-S. Do I need to report the exchange and sale to the IRS?

I answered the T-F questions, but question 1 in Part II as follows is false for me:

I owned and used the residence as my principal residence for periods aggregating 2 years or more during the 5-year period ending on the date of the sale or exchange of the residence.

I acquired the house 5/2020 and sold it 9/2020.

TurboTax Home & Biz Windows

Anonymous_

Level 15

@dsframe1953 wrote:

Do I need to report the exchange and sale to the IRS?

I am sorry for your loss. Yes, you need to report the sale to the IRS.

The basis of the home would be the fair market value on the date of death of your mother. The sales price would be the $172,000 less selling expenses. Odds are there is no gain since the sale and the date of death are separated by only a few months.

You can report the sale in the Investment Income section the same as if you sold a stock, mutual fund, or bond.

dsframe1953Author

Level 2

Can I somehow deduct the amounts I had to pay my 3 siblings when I divided the proceeds? I was the Executor, but my Mother's will said I must divide everything equally.