It is never a bad idea to sit down with a lawyer or, in this case, an accountant so that all the specifics of your situation can be considered.
That said, if your mother did not put you and your brother on the deed prior to death, your tax basis in the house is its value on the day your mother died. So, only the gain attributable to your share of the home would be income.
I am licensed to practice law in Michigan and Virginia and regularly handle cases of this sort. You should not rely on this answer. You should consult a lawyer so you can tell the lawyer the entire situation and get legal advice that is precisely tailored to your case.
If you "make money" on the deal your taxable income (capital gain) will be the difference in value between what it was worth when she died and the sales price (1/2 attributable to your half). An appraisal is a good idea, although for tax basis purposes you probably would have wanted an appraisal as of her date of death. You might be able to ask an appraiser to appraise it now and also give you a valuation as of her date of death (the appraiser probably can use comps from the area as of her death in Nov 2010).
This is not legal advice nor intended to create an attorney-client relationship. The information provided here is informational in nature only. This attorney may not be licensed in the jurisdiction which you have a question about so the answer could be only general in nature. Visit Steve Zelinger's website: http://www.stevenzelinger.com/
Your tax basis would be one-half of the value at the time of your mother's death if this were transfered to you by a probate estate or trust. If this was transferred to you by joint ownership on a deed your tax basis would be one-half of your mother's tax basis, which would be what she paid for the property, plus any capital improvements. If you have lived in the house with your mother for the past few years the sale may be exempt as the sale of your principal residence. I normally would say an appraisal is warranted, unless you are certain your sales price to your brother is significantly below your tax basis. We are in Mt. Pleasant and can help figure all of this out.
I agree with attorneys Conway, Zelinger, and Higgs. Your tax basis in this house will be its value at the time your mother passed away. An appraiser is always a good idea to determine a property's current value. An easy way to determine date of death value is to find the State Equalized Value (SEV) of the property for 2010 and multiply it by 2. This will give you what the State of Michigan determined as the property's cash value for that year.