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If you receive money from the sale of property that ...

Sent to Tax Experts August 26 2006 at 4:13 PM
   

If you receive money from the sale of property that was left by a granduncle is it subject to an inheritance tax, if yes is there a minimum taxable amount?

 

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Las Vegas, Nevada

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August 26 2006 at 4:25 PM (11 minutes and 18 seconds later)
         
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There is no inheritence tax in Federal and Nevada. You may owe capital gain tax.

For inherited property, your cost basis can step up to the fair market value on the date of your grandunce's death. You are going to responsible for the gain due to the post-death appreciation.

If you have used and owned the property as primary residence for 2 years out of 5 years ending on the date of sale, you may exclude the gain upto $250,000 for signle, MFS, $500,000 for married filing jointly. You can only exclude the gain once every two years.

For inherited property, your gain is always long term which is taxed at 5% or 15%, it is 5% to the extent of the 15% tax bracket.



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