Client along w two other siblings rec'd their dad's house in an inheritance threes ago after his passing. FMV of the house was $300K when they took possession 3 yrs. ago.
They recently sold the house for approximately $25k profit each after selling expenses. Do they have to pay capital gains on their portion and gain, or is it exempt as part of the inheritance? I have rec'd conflicting advise from other sources??? Help.
Gotta love those anonymous sources. Has the house been vacant for three years? Was one or more of them living in it is since then? The primary-residence exclusion might apply. Was it rented? The gain might be more than they think, after depreciation.