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Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
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Experience:  15years with H & R Block. Divisional leader, Instructor
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As a brother I sold my late sisters house for 41,200. On the

Resolved Question:

As a brother I sold my late sister's house for 41,200. On the attorney inheritance tax form I paid tax on 40,000. Do I have to pay inheritance tax on that $1,200?
Submitted: 1 year ago.
Category: Tax
Expert:  Robin D. replied 1 year ago.

Robin D. :

Hello and thanks for trusting me to help you today. I am a tax adviser with over 15 years of experience.


The rates for Pennsylvania inheritance tax are as follows:



  • 0 percent on transfers to a surviving spouse or to a parent from a child aged 21 or younger;

  • 4.5 percent on transfers to direct descendants and lineal heirs;

  • 12 percent on transfers to siblings; and


15 percent on transfers to other heirs, except charitable organizations, exempt institutions and government entities
exempt from tax.
Inheritance tax is imposed as a percentage of the value of a decedent's estate transferred to beneficiaries by will, heirs by intestacy and transferees by operation of law.
You would not owe inheritance tax on the amount you received for the sale. You would need to report the sale though but your basis (or cost) is the fairmarket value on the date of death.
Any gain would be the difference in basis and sale price.


 

Robin D. :

If the fairmarket value of the property was $40,000 and it sold for $41,200 then $1,200 will be shown as gain and taxed under capital asset %. As long term holding this will be lower than regular tax.

Customer:

are estates closings recorded at your local county courthouse. thank you

Robin D. :

Yes, the closing would be recorded

Customer:

what would happen if it was never recorded

Robin D. :

Then the process is not complete. You should speak with the attorney that handled this.

Customer:

can one person record this capital gain on there tax return or does all beneficiarys have to recored ther share. trying to make it easy

Robin D. :

The individual that inherited the property would have to show the sale. If the house was inherited by numerous beneficiaries then all would report their portion on their return.

Robin D. :

It just depends on who inherited the property.

Customer:

for some unknown reason the attorney needs my sisters last two years income tax filings, if I don't have them what is my options. ? why would he need them the estate has been settled with the state inheritance tax

Robin D. :

You would have to ask him why he needs those but the executor can request those copies form the IRS

Customer:

thank , you have been very helpful , have a good day, good bye

Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 7867
Experience: 15years with H & R Block. Divisional leader, Instructor
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Robin D.
Robin D.
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15years with H & R Block. Divisional leader, Instructor