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Merlo, Accountant
Category: Tax
Satisfied Customers: 9783
Experience:  25+ years tax consulting. Specializing in returns for US citizens living abroad
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I live in New York State, and I recently sold some property

Resolved Question:

I live in New York State, and I recently sold some property which was willed to me a few years ago by my mother.It was sold for $10,000.Do I have to pay any income tax on this?
Submitted: 8 years ago.
Category: Tax
Expert:  Merlo replied 8 years ago.

When you inherit property, you receive a "stepped up" basis, meaning that your basis in the property is the fair market value on the day you inherited it.

You would owe tax on any gain you had from selling the property, and the gain would be figured by taking your selling price less your "stepped up" basis. So you would not owe tax on the entire selling price, but only your gain.

This automatically qualifies to be treated as a long term capital gain, and the tax rate on those gains is currently capped at 15%. The sale is reported on Schedule D of your tax return.

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