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I should have asked this with my last question. It was

regarding the 3 sons that...
I should have asked this with my last question. It was regarding the 3 sons that sold the house that my grandmother had deeded into their names. How is the capital gain calculated on the money? Is it based on the FMV of the house at the time the house was transferred?
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Answered in 5 minutes by:
3/19/2018
Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 17,624
Experience: 15years with H & R Block. Divisional leader, Instructor
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NO, the FMV is not used. This was a gift so they retain the same cost or basis that the mother had. If she paid $40000 and had $10000 in improvements they will split that $50k 3 ways as their cost.

Had they inherited they would have received the step up in Basis to FMV. That is only allowed with inheriting not gifts unfortunately.

Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 17,624
Experience: 15years with H & R Block. Divisional leader, Instructor
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Customer reply replied 1 month ago
OK. Thank you.

You are most welcome.

Their gain is the difference in cost plus improvements and the sale price less cost to sale.

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