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Tax on sale of inherited property.
Posted on 10/6/26 at 6:55 pm
Posted on 10/6/26 at 6:55 pm
Folks sold some old raw property. No home on property etc.
This was a parents property. Should only amount to about 12,000. My parents are elderly and this is an old inheritance. Capital gains? Isn’t there an amount that needs to be exceeded before it’s taxed?
All property is in Louisiana.
This was a parents property. Should only amount to about 12,000. My parents are elderly and this is an old inheritance. Capital gains? Isn’t there an amount that needs to be exceeded before it’s taxed?
All property is in Louisiana.
Posted on 10/6/26 at 7:01 pm to LSU alum wannabe
You would likely be taxed at the difference of what the attorney valued the property at in the succession and what you sold it at. Most attorneys intentionally overvalue property during a succession to help prevent taxes.
So if they valued the property at $100k at the time of the succession and you sell it at $130k, you would possibly be taxed on the 30k profit.
So if they valued the property at $100k at the time of the succession and you sell it at $130k, you would possibly be taxed on the 30k profit.
Posted on 10/6/26 at 7:14 pm to LSU alum wannabe
A "step-up clause" in real estate usually refers to a step-up in basis, which is a tax rule that resets the value of an inherited property to its current market value when the owner dies.
Posted on 10/6/26 at 7:26 pm to LSU alum wannabe
Take the sales proceeds and subtract out closing costs and the value at the time of inheritance, assuming the original owner was deceased before it transferred to your parents.
If the original owner gave your parents the property before they passed away, then your parents basis is what the original owner paid for the land. No adjustments for inflation.
There’s no threshold to trigger if it’s taxed or not, as it was never anyone’s primary residence.
If the original owner gave your parents the property before they passed away, then your parents basis is what the original owner paid for the land. No adjustments for inflation.
There’s no threshold to trigger if it’s taxed or not, as it was never anyone’s primary residence.
Posted on 10/8/26 at 9:42 am to LSU alum wannabe
The gain is taxable (proceeds-basis). But long term gains are only taxed if your other income exceeds certain thresholds. About $98,000 for MFJ.
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