I am thinking about selling the house. I have lived with my mother before she passed away. When is the ownership of an inherited property? Is it the date of death? When the probate recorded the title change the first time? They also needed to re-record the title change because the property was in a previous name and the documents were in her final name (so the assessor has the latest date), is this final assessor accepted date the date of ownership?
The basis of the house receives a step-up/step-down when you mother passed away, valued at the date of death (or on the alternate valuation date if so elected on an estate tax return). So for home selling purposes, that value is the beginning point of calculating your basis in the home. The date of your ownership, according to the IRS instructions, is the date the title transferred or the date the economic burdens and benefits of ownership shifted to the transferee. Often times they are the same date. In other words, to take advantage of the exclusion you need to own the home at least 24 months out of the preceding 5 years before the sale, and use the home as your residence for at least 24 months out of the preceding 5 years before the sale. See the link below for more IRS info. Speak with a tax advisor for assistance.
Unless you are a client of Yuan Law Firm, APC, under a current and signed representation agreement, you should not rely upon any information provided in this Q&A as legal advice. There is no attorney-client relationship between you and the attorney or the law firm. Circular 230 Advice: Pursuant to U.S. Treasury Department Regulations, we are required to advise you that, unless otherwise expressly indicated, any federal tax advice contained in this communication, including attachments and enclosures, is not intended or written to be used, and may not be used, for the purpose of (i) avoiding tax-related penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any tax-related matters addressed herein.
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