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Old 09-29-2015, 08:18 PM
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capital gains on inheritance

my sister and I inherited my Mothers estate recently, she was a 50% partner on some rental property. The other partner does not want to sell because he would have a tax issue the property is 3 smaller parcels and 1 larger parcel,
he wants to quitclaim the larger to us and keep the smaller. The larger is worth more than the 3 smaller properties, the larger is worth about 2 mil the smaller is worth about 1.7 mil if we devide by 50% for the partner our base is $1,850,000. we intend to sell, if we sell for the 2 mil do we pay capital gains on the overage. Or do we just appraise the large pc at the 2 mil and sell for that with no capital gains. right now the property is still in her trust we have not moved it yet. It has only been a little over a month and there has been so much to do Too much to do in such a short time after a big loss



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Old 09-30-2015, 02:56 AM
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my sister and I inherited my Mothers estate recently, she was a 50% partner on some rental property. The other partner does not want to sell because he would have a tax issue the property is 3 smaller parcels and 1 larger parcel,
he wants to quitclaim the larger to us and keep the smaller. The larger is worth more than the 3 smaller properties, the larger is worth about 2 mil the smaller is worth about 1.7 mil if we devide by 50% for the partner our base is $1,850,000. we intend to sell, if we sell for the 2 mil do we pay capital gains on the overage. ======>>As you aren’t the only sibling selling the property may well be the best option, especially if there is any disagreement for some reason on who should own which parcel of property / how to move forward. This way everyone can take their share and do what they want with it.

You need to report the sale of inherited property on Sch D of Form 1040 an dform 8949( you need to report the sale or exchange on a Part II with the appropriate box checked (D, E, or F). Enter “INHERITED” in column (b).
The IRS considers the sale of inherited real estate/pty long-term capital gains, regardless of how long you owned the property, so you must enter information about the sale in Part II of Sch D starting on Line 8.

Or do we just appraise the large pc at the 2 mil and sell for that with no capital gains. right now the property is still in her trust we have not moved it yet. It has only been a little over a month and there has been so much to do Too much to do in such a short time after a big loss =====>> As the ptyis held in a trust before it's passed on to you, you may have the opportunity to sell the pty before it's transferred out of the possession of the trust. You need to contact the trustee of the trust to ask the trustee to sell the pty. While the pty is in the trust, the trustee is the one making all the decisions regarding it. If the terms of the trust allow it, the trustee may then put the pty up for sale with your help



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