re: Can someone explain the “ins and outs” of inheritance tax for me?

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Say we get her parents’ house that is worth $400,000 and paid off. What would we owe? Just property taxes? Could I sell the house with just standard taxes or would inheritance tax come into play there as well?

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Others have given more in depth answers, but the only thing you should owe is state taxes. As long as you are below the $5m mark, the feds don't care.

Yes, you can sell the house or any other assets (stocks) without paying the short term gains penalty of you only owning the assets for a short period of time. When you file your taxes, your CPA should put down that it was an inheritance as the acquisition date and there shouldn't be any penalty.