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ricealbny · Apr 16, 2010, 11:55 PM

My Mom passed away and left her home and land to 8 of us. We sold it to one sister for the value of $ 17,000. Our Lawyer was of no help to us. What kind of taxes are we responsible for? This is in Georgia. Our Dad passed away in 2006. Mom passed in Aug. of 2009.

ScottGem · Apr 17, 2010, 04:17 AM

What was the value of the property when your mother died?

ricealbny · Apr 17, 2010, 12:35 PM

$17,000 was the value at the time of her death and that is what we sold it to my sister for + 1/9 th of the money went to her. The rest of us are worried about whatever taxes are due on the inheritance and sale of the house.

ScottGem · Apr 17, 2010, 01:57 PM

That's not what I asked. To determine your tax liability, you need to get an appraisal of the property at the time of her death. That becomes your tax basis. You then compare that to the selling price to determine your tax liability.

It sounds like you sold it to your sister for the balance remaining on the mortgage. What was done with that money?

ricealbny · Apr 17, 2010, 02:48 PM

The property was appraised at $17,000 and was divided among us kids after paying the one remaining Hospital Bill of $103.58. It was appraised and sold at the same price. It was appraised within a month after Mom passed and just now... yesterday the amount was divided.

ScottGem · Apr 17, 2010, 06:15 PM

If it was sold for the appraised value, then there was no profit, and no tax liability.

ricealbny · Apr 18, 2010, 08:51 PM

Scott that's great. My income now is Social Security but almost not worth talking about. Do I have to file with the IRS? My part of the house came to $2074.75. Is there any other Taxes or monies that any Government office will want to take part of it. I am afraid to even spend a dime of this money for fear of something coming up at a later date. This isn't much money but I have some very important repairs I need on my house. I truly appreciate any help. Martha

MukatA · Apr 19, 2010, 03:39 AM

There is no tax on inheritances. Also if your only other income is SS benefits, you do not have any taxable income.

ScottGem · Apr 19, 2010, 03:56 AM

MukatA is correct in your instance. Taxes on inheritances don't generally kick in until the estate is over $2 million.

There might be estate taxes, but they would be paid from the estate. Whoever was executor of the estate needs to deal with this. Also, if there were any debts owed, they have to be paid from the estate before any distributions can be made.

So I can't answer whether you can spend this money without knowing more. You need to talk to the executor to make sure there aren't' any gotchas.

AtlantaTaxExpert · Apr 19, 2010, 01:26 PM

Given the amounts discussed, there are NO inheritance taxes and there are NO estate taxes.

The sale of the property must be reported on Schedule D for the seller's tax return, but since the sale happened within a year of the mother's death, there will be no capital gain to report, hence no tax consequence.