Legal Question in Wills and Trusts in California

This question should be directed to a tax attorney; however, the trust will need to file a fiduciary tax return with the IRS; You should seek assistance from an estate planning attorney re the closing of the trust, and the documentation that is required.

As a general rule, there is no income tax on an inheritance. There are exceptions, but they do not appear to apply here. The house was a personal residence that was fully paid for, and there are no issues of taxes on unpaid income that your mother had earned.

As are result, the money should pass to you and your siblings tax-free, and does not need to be reported on your personal income tax returns.

You should consult an estates and/or probate attorney, however, to see if the trust needs to file any tax returns, and to assist you in the transfer of the property from the trust to the buyer.