[CuriousSister]

I live in Calif, my brother owned property in Indiana, died and left it to me. Will I pay inheritance tax on it when I sell it?

[MukatA]

There is no federal tax on inheritances. Most of the states do not tax inheritances. CA does not have inheritance tax. For IN, check at the state web site.
If you inherit a property, your cost basis is the fair market value at the date of death. So when you sell the property, you may have a gain or loss depending upon the sale price is more than your cost basis or less than your cost basis. Report on schedule D.
Your U.S. Tax Return: Tax on Inheritances

[ebaines]

One cavaet - if your brother passed away in 2010 then the rules for setting your cost basis are different - a result of the estate taxes having been repealed for 2010 only. Let us know if this is the case and we'll fill you in on the ugly details. If he died in 2009 or earlier then the cost basis is as Mukata said.