Legal Question in Wills and Trusts in Texas
Taxes on property of deceased parent
My mother and father passed away last year and appointed me as executor of the estate.
The will stated to sell all property and divide funds amongst 5 children.
I recently sold her house and need to know if I have to file federal taxes on the income of the sell before distributing the funds to the 5 children.
The house was never transferred out of my parents name before selling and was in Texas.
2 Answers from Attorneys
Re: Taxes on property of deceased parent
The basis of the property was "stepped up" to its value at the time of the last parent to die. This means there are probably little, if not zero, capital gains to pay regarding the house sale. Talk to your accountant to see if there are sufficient funds to make a distribution to the heirs. As executor, you have an obligation to make sure all of the obligations of the estate are paid.
Re: Taxes on property of deceased parent
I'm unclear as to your question. You stated that you sold the house without transferring it from the parents' name. How did you sell it? Did you use a title company? Agent? What paperwork did you use to transfer the house? Have you received letters testamentary?
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