Inheritance Rules For Married Couples

Heavenly - Inheriting a house comes with a tax rule most heirs don't hear about until they sell. It resets what the house is worth for tax purposes, and it can erase decades of gain. It's called stepped-up basis. When you inherit property, your basis is generally its fair market value on the date of death, not what the owner paid. Say a parent bought a home for $90,000 and it's worth $400,000 when they die. The heir's basis is $400,000, and a sale at that price shows no taxable gain. If the same parent had given the house away while alive, the child would have kept the $90,000 basis, and a $400,000 sale would carry a $310,000 gain. Married couples get a smaller reset. When spouses own a home together as joint tenants or tenants by the entirety, half of its value is counted in the estate

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