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I INHERITED AND SOLD MY DECEASED FATHER'S HOME IN NH FOR…

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I INHERITED AND SOLD...

I INHERITED AND SOLD MY DECEASED FATHER'S HOME IN NH FOR $145,000. I ALSO LIVE IN NH WHERE THERE IS NO ESTATE TAX. DO I HAVE TO WORRY ABOUT PAYING ANY TAX ON THIS?

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Submitted: 9 months ago.Category: Tax
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Answered in 1 minute by:
11/17/2017
Tax Professional: Lane, JD, CFP, MBA, CRPS replied 9 months ago
Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 14,894
Experience: Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
Verified

Hi. My name's Lane -

I hold a law degree (J.D.), with concentration in Tax Law, Estate law & Corporate law, an MBA in finance, a BBA, and CFP & CRPS (Chartered Retirement Plans Specialist) designations, as well - I’ve been providing financial, Social Security/Medicare, estate, corporate, non-profit, and tax advice 1986

...

Bear with me a second while I write my response. Then if you still have questions, we can go from there

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Tax Professional: Lane, JD, CFP, MBA, CRPS replied 9 months ago

No, no tax here at all.

...

Normally, when we sell an asset we MIGHT have a capital gains tax to pay. But, when we INHERIT an asset like this, there's what's called a "step-up" in basis.

...

Capital Gain = Sales price - Basis ... and normally basis is what we have invested in the asset (purchase price plus improvements)

...

But again, when we inherit, the basis is STEPPED-UP to the fair market value of the asset on the date we inherited.

...

PLUS we get to add any improvements, and selling costs (such as commissions) TO that basis.

...

So HERE if you sold fairly quickly (within a year or two) there's no gain at all.

...

And there's no income tax from the inheritance itself, because section 102 of the Internal Revenue Code exempts gifts and inheritance from tax. (https://www.law.cornell.edu/uscode/text/26/102)

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Tax Professional: Lane, JD, CFP, MBA, CRPS replied 9 months ago

Again, based on what you've said (your state, and the value of the estate) you have no tax obligation at all here.

...

Please let me know if you have ANY questions at all, before rating me.

If this has helped, and you DON’T have other questions … I'd appreciate a positive rating, using the stars on your screen, and then clicking “submit" – That’s the only way I’ll be credited for the work.

...

But again, if you need more on this, please let me know.

Lane

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