Stock held in estate was distributed to me as stock and others was sold and given cash. Do I owe tax on theirs

Question

4800 shares of stock. I got 1/3 in stock. The executor (my sister) sold the 3200 and distributed 1/3 of the cash to her and 1/9 each to a church, a college and a granddauhgter as specified in the will. Her accountant says I have to pay 1/3 of the capital gains on the sale of the 3200 shares even though I received none of the money. I later sold most of my stock and paid capital gains on it already. The other inheritors aren't paying any of my capital gains for me. What can I do?

Answer 1

The cash you received is not taxable to you at all. The capital gains tax for the shares sold by the estate are paid by the estate, not by you. Her accountant is incompetent if he or she says otherwise.

For the stock shares that you received directly, you will possibly owe capital gains taxes when you sell the shares. Your basis in the shares is the stepped up basis of the shares on the date of the bequestor's death. If you sell any shares for more than that basis you'll have a taxable long-term capital gain.

Answer 2

I agree with the previous answer.

Sounds like her accountant is trying to get you to pay their shares of capital gain tax.

Best wishes.