Tax consequences when selling a house I inherited

Inheriting a home is a pretty sweet experience, yet bitter at the same time… You are left with great property value you can use to improve your life, but you are still mourning the loss of a loved one. So you may tend to ask yourself at this point “what are the tax consequences when selling a house I inherited?” The tax laws have been designed in a way they will not add any more burden unto you upon inheriting the property. This implies that the financial consequences are less daunting than what you would expect, which is good news for you. 🙂

tax consequences when selling your  Floresville house in you inherited

Tax Consequences when selling a house I inherited in Floresville TX

Calculation of basis
In order to comprehend how you’ll be taxed having inherited a home, you need to know how basis is calculated. Basis, in this case, refers to the asset value for purpose of the calculation of capital gains along other taxes. When a person dies, the value or basis of their property in Floresville is increased to the market value as at the time of their death. For instance, if a person purchased a home 20 years ago for $25,000 but it was worth $100,000 at the time of their death, that property would be valued at the latter amount for the purpose of calculating capital gains to the heirs. It is important to know this fact so you will have the correct basis for which to determine the value of the property at the time of death.   Had the owner sold the house for $100,000 they would have a profit based upon on IRS rules of $75,000 but a person who inherits the property and sells for $100,000 will have no profit.  There are some other tax rules that come into play for the owner but this example is for illustration purposes of the difference between the two values.**

Taxation of gains/losses

Capital gains or losses refer to what you earn from selling property that you use for either personal or investment purposes. Such can be houses, furniture and many more things. If you decide to sell an inherited home in Floresville, that sale is regarded as capital gain or loss for the purpose of income tax. In most cases, for you to qualify for lower rates of long-term capital gains, you are required to have held that property for at least a year. However long the duration you have been in ownership of an inherited home, any gain or loss will still be treated as long-term.**

Reporting the sale

Upon selling an inherited home, you have to report it for the income tax purposes. You should first calculate your capital gain or loss. This is done by subtracting the basis from the sale amount. You should then report that amount to the necessary authorities.  That is why having gotten a basis value is so important.  It is a good idea to have an appraisal done by a professional appraiser based upon the date of death.  Having it done as soon as possible may save you headaches in the future.

Having an inherited home can be stressing given the fact that you have new property to take care of and pay taxes for it at the same time… not to mention an extra mortgage payment.  You should go through the probate process in Floresville as the first step to selling your home. The court will then authorize you to proceed as you wish if you are appointed the executor of the estate. If there are any other individuals involved in the inheritance, you should first agree with each other on that decision. You can then file a petition requesting the court to allow  the property to be sold.

You should then consider how much tax you are to pay. This will be paid against the capital gains or losses resulting from the sale of the house. You can call Faye Y Taylor with StepStone Realty now at (210) 216-7722 to undertake a smooth and legitimate sale of your home. We are local here in Floresville TX and we know the market here better than anyone else. If you are still asking yourself what are the tax consequences when selling a house I inherited in Floresville, then we would be happy to discuss it with you in more detail.

Selling an inherited house can relieve you of quite a burden. In addition to that, discussing selling the property as a retail sale or to an investor which is a basic simple and fast process can help you pick the best option. Contact us for inquiries on how to go about things when selling your home in Floresville and we will be glad to help you.


You can fill out the form or pick up the phone and give us a ring anytime at (210) 216-7722

For more articles on inherited houses see:

What happens when you inherit a house?

Is there a holding period when I inherit a house?

Should I rent or sell my inherited house?

Can I sell an inherited house while in probate?

The Probate Process


As the Floresville Real Estate Agent – Faye Y Taylor is here for your questions and to help



**I am not a lawyer nor a practicing accountant. This Website provides general information related to the legal matters designed to help  but does not provide legal advice.  Although we work to make sure our information is accurate and useful, we recommend you consult a lawyer if you want/need legal advice. No attorney-client or confidential relationship exists or will be formed between you and us.


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