[pammieinmiami]

1.5 years ago my father quit claimed deeded his homesteaded property to himself,me and my brother, with the rights of survivorship. Subsequently my father entered a nursing home. He passed away last week. The property is now in my name and my brother's with rights of survivorship. We live in Florida. What is the rule on selling the home. Is there a time limit after the death of my father? Will my brother and I be responsible for capital gains if we sell the home.

The home is not rented. My brother and I each own our own home and have homestead on the properties we own.

Thank you...

[AtlantaTaxExpert]

This is more a LEGAL question than a tax question.

That said, I believe the house is STILL part of your father's estate which must be properly probated before you can dispose of the property.

Recommend you seek out the advice of an estate attorney.

As for the sale, the property's basis is "stepped up" to the Fair Market Value at the time of your father's death, so after the costs of the sale are factored in, you will probably show a paper LOSS on the sale. It still has to be reported on your and your brother's tax return, but a loss on personal property cannot be claimed.

[ebaines]

Maybe I am over-complicating this, but here goes:

Seems to me that when your father filed the quit claim deed he made a gift of 1/3 of his property to you and 1/3 to your brother. As a gift, your cost basis in your 1/3 ownership is 1/3 his original cost basis + 1/3 of adjustments to that basis (capital improvements he may have made). Then when your father passed you now own 1/2 of the property, and because of the "step up" rules for cost basis of inherited property your cost basis is increased by 1/6 of the fair market value of the property as of the date of death. When you sell the property you will report 1/2 the sales proceeds as your share, and use the cost basis as calculated above.