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Inherited Property
Do You Have to Pay Taxes on an Inherited House You Sell?
This is one of the most common questions, and the answer is usually better than people expect.
The step-up in basis
Inherited property typically gets a "stepped-up" tax basis to its value at the date of death, not what the original owner paid — which often significantly reduces or eliminates capital gains tax when you sell.
What could still apply
If the home appreciates further between the date of death and the sale, you may owe capital gains tax on that difference — but usually not on the full sale price.
Estate taxes are separate
Maryland has its own estate and inheritance tax rules that are separate from capital gains — worth checking with a tax professional about your specific estate.
This is genuinely a "talk to a tax professional about your specific numbers" situation — but the step-up in basis is good news worth knowing about going in.