I have a client who inherited a house in 2021. He and his wife were planning on renovating it then renting it. Plans changed and after renovations decided to sell house instead of renting it. It was never rented. I have prepared returns where a client sold a rental property but never the sale of an inherited one.
My question is what form do I use, and how to figure out capital gain. I assume that you would take value of property at time of inheritance as the cost and the sale price minus renovations and all sale costs as sold cost.
Thanks, I am just a small sole proprietor and don’t do many property sales other than personal property.
There is no difference between a house that is inherited and a house that was bought apart from the determination of the ACB. Nor are there any special forms that the beneficiary would have to file.
However, I would suggest that you need to look at the terminal and the trust returns to determine the declared value of the property at the time of inheritance. That way you report the same information and don’t have a later surprise.
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+1 Exactly.
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