Q: My grandfather and I have jointly owned a property in PA for the last 2 year he just passed away will I owe taxes..
My grandfather and I have jointly owned a property in PA for the last 2 years. He passed away this year and the
property transferred solely in my name. Is there any kind of tax I will have to pay when I sell it. The land was purchased for 18k and we rebuilt the property form the ground up. Invested around 70k. Recently had an appraisal on the property for 130k and will be selling for 105k... this is not my primary residence.
A: You might be subject to a capital gains tax. I would consult with an accountant.
A:
There will be a 4.5 % inheritance tax on the half that your father owned, and which passed to you. There will also be a capital gains income tax on the sale, which is measured on the gain over “basis.” “Basis” is, essentially, your cost of acquisition plus costs of documented improvements. With respect to the half that was your father’s, there is a “step-up” in basis because of the payment of inheritance tax. His half takes on the date of death value as its basis. If you sell the property for no more than the date of death value, there should be no capital gain assessed on your father’s half.
You should consult an accountant or attorney for further advice.
Justia Ask a Lawyer is a forum for consumers to get answers to basic legal questions. Any information sent through Justia Ask a Lawyer is not secure and is done so on a non-confidential basis only.
The use of this website to ask questions or receive answers does not create an attorney–client relationship between you and Justia, or between you and any attorney who receives your information or responds to your questions, nor is it intended to create such a relationship. Additionally, no responses on this forum constitute legal advice, which must be tailored to the specific circumstances of each case. You should not act upon information provided in Justia Ask a Lawyer without seeking professional counsel from an attorney admitted or authorized to practice in your jurisdiction. Justia assumes no responsibility to any person who relies on information contained on or received through this site and disclaims all liability in respect to such information.
Justia cannot guarantee that the information on this website (including any legal information provided by an attorney through this service) is accurate, complete, or up-to-date. While we intend to make every attempt to keep the information on this site current, the owners of and contributors to this site make no claims, promises or guarantees about the accuracy, completeness or adequacy of the information contained in or linked to from this site.
