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Author: RooCat Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121095  
Subject: Re: Capital Asset inheritance Date: 3/24/2000 3:44 PM
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So, if I understand this right, I report the appreciation of the home from the time I inherited until the time I sold it, the basis, ( I'm extimating roughly 5% appreciation in a 1 1/2 year period) and weigh the expenses against the income resulting in a loss or a net gain whichever. How do I report my
realization of the value of the home less the appreciation. In other words how do a I account for the
unearned income of the pure inheritance and then account for the standard inheritance deduction. I
believe the sale was reported to the IRS and so I'm sure there must be a way to report the inheritance status of the sale price less appreciation value.


I don't think so. Apparently we are talking two different languages. Your basis in the house is exactly the value of the house at the date of death (which value you should have had from the estate). You do not get to add anything to this basis except for the repair, advertising, etc. expenses you actually paid for necessary to sell it. You do not get to add further appreciation to the basis. Your profit or loss is the sales price less commission less expenses less the value at date of death.

There is no unearned income from the inheritance. Inheritances are not a taxable event to the beneficiary. Only the sale of inherited property is a reportable event which may be a gain or a loss depending on the fair market value of the property at the date of death. There is no standard inheritance deduction. There is no reporting of the inheritance status.
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