What is the capital gains tax on inherited assets?

What is the capital gains tax on inherited assets?

When you inherit assets, you typically don't pay capital gains tax until you sell them. The tax is based on the asset's value at the time of inheritance.

So, if I inherit a house, I won't owe taxes until I sell it?

Correct! You will owe capital gains tax only on the increase in value from the time you inherited it to the time you sell it.

What if the house has decreased in value since I inherited it?

If the house has decreased in value, you may not owe any capital gains tax, and you could even claim a loss if you sell it for less than its value at the time of inheritance.

Are there any exceptions or special rules I should know about?

Yes, there are exceptions, such as the primary residence exclusion, which may allow you to avoid capital gains tax if you meet certain conditions.