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He will pay tax on any gain from the date he inherited till the property was sold.
The tax will be based on the difference in the sale price and the fair market value on the date he inherited the property
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So he has to pay taxes on the difference of what he actually received from the sale and the value of it?
That is correct
If it has not been very long since inherited he may see a loss (with today's market)
He could use that loss against other gains and even $3000 of loss against income
Does it matter what state?
No, most do the same. What state though and I will check
Then there is no tax in Texas to pay on the sale. He will just include on his federal
Texas does not have income tax
ok and that would be how to do it on the federal side right?
That is correct. He will show the sale on Schedule D
does the property have to have been lived on or does it matter?
No, if he had used it as his main home for 2 years then he could have used the exclusion up to $250,000 of gain. M<ost people find that with inherited they have a loss
oh i see ok thanks so much
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