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I own my primary residence in California that I inherited from my parents many years ago. They originally paid under $10K for the property, it is now value at approximately $1M. The house is in my name only, though I have lived in the home for many years with my husband. We are preparing to sell the home but want to make sure we take the necessary steps to ensure the best outcome. In California there is A $250K capital gains tax exemption for individuals and $500K for married couples. Will we be abe to claim the full $500K? Do we need to transfer title into both our names?

Submitted: 37 days and 21 hours ago.

Category: Tax

Value: $15

Status: CLOSED

Accepted Answer

The capital gain exclusion of $500,000 also applies to federal income taxes. Your cost basis for determining the amount of gain to report will be the fair market value on your parent's date of death not their original cost basis.

You do not have to transfer title to both names to claim the $500,000 exclusion amount as long as one of you have owned it and you file a joint return.

http://www.irs.gov/businesses/small/industries/article/0,,id=98921,00.html

See page 13 for "Married Persons" - http://www.irs.gov/pub/irs-pdf/p523.pdf

http://www.ftb.ca.gov/individuals/faq/ivr/219.shtml

Accepts:
Expert:	Bill
Pos. Feedback:	99.6 %
Answered:	10/15/2009

Enrolled Agent

EA, QPA, CHFC, CEBS, CLU - 29 years experience providing financial advice

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