Back in June 2020 my mother passed and left me with two documents, a Last Will and Testament and a Transfer on Death Deed that applied to her home transferring her interest in the property to me.
I consulted an attorney about how I needed to go about selling the property and what the Transfer on Death Deed meant. He told me that the transfer document effectively takes the real property out of the will and since it had previously been recorded by the County Recorder's Office, that I was now the legal owner of the property and could sell it at anytime. I subsequently sold the property, paid off the remaining mortgage and realtor fees and ended up with a net amount in cash.
The rest of the estate, which consisted of a small amount cash in a bank account, personal items which were sold was evenly divided between myself and my sister who was listed in the will. The total was about $4500 altogether. I understand that is well under the Estate Tax threshold.
My question is about the proceeds from the home sale. Is this taxable? If so, how is it taxed and where is it reported on my 2020 taxes?