What are the tax implications when a parent puts your name along with theirs on a co-op and they pass away?

Question

The co-op was purchased in NY for 47K 10 years ago. My mom put my name on the co-op along with hers. 7 years ago, she passed away and the co-op passed to me and I had her name taken off. Now the co-op is valued at 200k. Was I supposed to pay taxes from receiving the co-op when she passed away? She didn't have any estate. And now if I sell the co-op to buy a first home, do I have to pay taxes on the gain from 47K to 200k? Or do I have to pay taxes on the gain from value at death to 200k?

Answer 1

This is a very complicated question to answer and I am no expert. First, there is the question of inheretence. I do not believe there is any tax due, at least not at the federal level. There may be at the state level. Next the value of the property at time of death. Since you wer on the deed when it was purchased, you were part owner then. Generally, assets inhereted are valued for capital gains at the time of inheretance, but in this case I am not sure.

Now for the capital gains question. There is a life time exemption of I believe $500,000 is captial gains on a residence.

Answer 2

Assuming she provided all funds for purchase the coop is all her property for estate tax purposes. If her gross estate was less than 600K no estate tax return was due. Your cost basis is the value at death. If you failed to get it appraised when she died you can get an appraiser to do a retroactive appraisal as of the date of death. The increase to sale will be a long term capital gain taxed at no more than 15% for Federal.

Answer 3

It depends on how you were vested in the property. If you were vested as a joint tenant with rights of survivorship then you may sell the property and re-invest in any other property with no tax implications. But to be sure seek the advise of a C.P.A. or an attorney to make sure.

Answer 4

depends on local laws