Have a Tax Question? Ask a Tax Expert
When you and your sister inherited the home from your mother, you were each entitled to a "stepped up" basis in the home. That means that whatever the fair market value was of the home on the day of your mother's death, that would be your new basis in the home.
When you sell the home, you are liable for tax on any gain realized from the sale. Your gain will be calculated by taking the selling price less your basis. Since your mother just passed away recently, then chances are that there will be little or no gain on the sale, since your basis was the fair market value of what the home was in May when she passed away.
If there is any gain on the sale, it would automatically be taxed at the long term capital gains tax rat which is currently capped at 15%.
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