Probate, process and responsibilities with taxes and beginning probate in WA state

When you inherit property you are entitled to a "step up" in basis. Consequently, you will only be taxed on the increase in value between the date of your father's death and the date of sale. However, you pose a more difficult question. Since your sister was "on the deed" I assume you mean that she was a joint tenant and took full title when your father died. I also assume that you sued your sister, or got her to agree that you and your brother were entitled to share the inheritance. Assuming those facts, you should be entitled to a step up in basis. If the transfer from your sister to you and your brother was considered a gift, you would take the gift with the basis your sister has in the property.