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Taxes on Inherited Property
Taxes are one of the biggest worries for families inheriting a home. The good news: the rules are often more favorable than people expect. This is general education only — speak with a CPA or tax professional about your situation.
Inherited Property Associates is not a law firm and does not provide legal or tax advice.
Step-up in basis
Under federal law (IRC §1014), inherited property generally receives a new tax basis equal to its fair market value on the date of death. If you sell soon after inheriting, there may be little or no capital gain. A date-of-death appraisal is helpful documentation.
Inheritance and estate tax
Florida has no state inheritance tax and no state estate tax. A federal estate tax applies only to very large estates above the federal exemption amount.
Property taxes and delinquent taxes
Property taxes continue after death and are typically reassessed after ownership changes. If taxes go unpaid, the county sells a tax certificate; after a period (generally two years), the certificate holder may apply for a tax deed, which can lead to the property being sold at auction. Address back taxes early.
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