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Not totally true. We dont know if they cleared the hurdle on federal estate taxes or state inheritance taxes. You need alot to owe on the federal but depending on the state its easy to owe.
Some states have a threshold thats very low.ohio has a very low one.
Some states like new jersey and maryland have both an estate tax and an inheritance tax so estate taxes are not just a federal thing totally
Last edited by mathjak107; 11-11-2012 at 12:32 PM..
We didn't have it appraised initially, but the buyer's mortgage company sent out an appraiser and it's been done. Do I need a copy of that, even though we offically sold it?
If the estate was proabte;whciuh I assume it was;then a appraisal shoud,be include in that.
Yes - but that (the original purchase prices in 1961) doesn't matter to you. That would have mattered to them if they had sold the house.
When the house transferred to you and your siblings, its cost basis reset to whatever it was at that time.
So - (this is all hypothetical!!) - lets say that before you fixed it up, it would have reasonably sold for $150K as a fixer-upper.
You did some work on it - and fixed it up, and I think you said it sold for $180K+...
So, in my hypothetical scenario - there were capital gains of 30K.
Again - a very simple hypothetical, I'm not talking about the money you put into the place or anything.
When someone dies whatever they transfer to you, (stock, real estate, etc..) the cost basis "steps up" at the time of transfer.
We are dealing with this now with the transfer of things from my mother (who just passed) to my father. And I would imagine in a few years we'll be dealing with the transfer from my father to us.
I suggest consulting with a tax specialist, just to make sure everything is handled correctly. Somone will have to file taxes for the decedent for the last year of their life (their estate must file taxes), in addition to whatever personal capital gains taxes you will run into.
My mother passed away in England leaving us(3 kids) with a condo in London.
There is a reverse mortgage on that condo in the amount of 1,000,000 pounds
and I think the place is worth around 2,000,000 pounds. In Uk we have to pay
40% to the HRMC. I think after the first 650,000 you pay taxes on the
350,000 pounds or 40% of the 350. DO I have to pay taxes here in the
USD when I get my settlement? Thanks for your help. abdi
I sold property which is in the name of my deceased mother. Before selling of property i transfer property in my name. Is there any tax i have to paid on sale amount. Please guide me.
Amit
I sold property which is in the name of my deceased mother. Before selling of property i transfer property in my name. Is there any tax i have to paid on sale amount. Please guide me.
Amit
In Croatia, the inheritance of a house by a non-spouse is subject to a tax at a flat rate of 5%. The tax base is the market value of the estate less the debts and expenses related to the inherited assets. Since the value of the property is $250,000 and there are no debts or expenses, you owe $12,500.
Since you did not list your location or any other details I made some assumptions. If they are wrong, please ignore everything I have written.
To summarize:
You start with the value of the house on the day of death. (there is a 6 month date but I do not think you qualify)
Since you do not know the value you will have to estimate it. You can probably back out the 20,000 in materials you put in from the mortgage appraisal. This is not correct but should work. Better would be to hire an appraiser and have the value of the house at the time of death estimated by the appraiser. Probably not worth the expense.
The taxable value of the house is the value on the date of death plus the 20,000. The taxable amount is the difference between this value and what the house was sold for.
I realize that this could be zero under my suggestions. I do not think you can include the value of your own labor in the costs basis. I would ask your tax attorney how to handle it. I think you just forget about it.
I think you should consult a tax professional. It varies by state. There are exemption thresholds. Meaning unless the estate is over a certain amount, you don't pay. I recall selling my mom's condo and I don't think I paid any taxes on it because it was under the amount. Don't take advice from here because every state is different and there are a lot of factors to consider.
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