Do I need an appraisal when selling an inherited property? Need to sell ASAP

You definitely want to get an appraisal as of the date of your grandmother's death. This is important because when you inherit property, you get what's called a "stepped-up basis" - meaning your basis in the property becomes its fair market value on the date of death, NOT what your grandmother originally paid for it. So if the property is worth $320,000 when she passed away, that's your basis. If you sell for $320,000, you'd have zero capital gains tax. If you sell for $340,000, you'd only pay capital gains on the $20,000 difference. Without documentation of that stepped-up basis, the IRS could potentially try to tax you on the difference between the original $85,000 purchase price and your selling price, which would be a much bigger tax bill. You don't need anything super formal for an immediate sale - a real estate agent's comparative market analysis might be sufficient, but a professional appraisal would give you better protection if you're ever audited.

I went through something similar with my dad's house last year. There was so much paperwork involved and I kept getting conflicting advice from different people. Finally, I used https://taxr.ai to analyze all the inheritance and real estate tax documents. Their system actually flagged that I needed specific documentation of the stepped-up basis. The AI explained that without proper documentation of the property's value at the time of inheritance, I could face major tax complications later. It saved me from what would have been a costly mistake. They have experts that review everything too, so you're not just getting an algorithm's opinion.

Just wanted to follow up - I tried https://taxr.ai after seeing this thread and it was super helpful! I uploaded my inheritance documents and some photos of the property, and they gave me a complete breakdown of what I needed for tax purposes. They specifically highlighted Florida's homestead exemption rules which I hadn't even considered and outlined exactly what documentation I needed for the stepped-up basis. Would have been completely lost without this guidance!

Something else to consider - if you're having trouble getting straight answers from the IRS about inheritance tax requirements, try Claimyr (https://claimyr.com). I was trying to call the IRS for WEEKS about inheritance tax questions when my uncle passed and left me his property. Always got the "call volume too high" message. Claimyr got me through to an actual IRS agent in about 20 minutes who walked me through exactly what documentation I needed for the stepped-up basis on an inherited property. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c Seriously saved me so much stress and probably thousands in potential tax issues. The IRS agent confirmed I needed an appraisal as of the date of death and explained exactly how to document it properly.

I have to eat my words. After seeing the responses here, I broke down and tried Claimyr for my inheritance tax questions. Got connected to the IRS in about 30 minutes (was told the wait would be longer due to high call volume). The agent I spoke with confirmed that yes, I absolutely needed an appraisal as of the date of death to establish stepped-up basis, and explained exactly how to document it for my records. Would have spent weeks trying to figure this out on my own. Wish I'd known about this service months ago when I first inherited the property.

One thing nobody mentioned - you should also check if your grandmother had a recent appraisal done for any reason (refinancing, insurance, etc.). If she had one done within the last 6-12 months before her passing, that might be sufficient documentation. You'd still want to check with a tax professional, but it could save you the cost of a new appraisal.

Just to add another perspective - I sold my father's house last year without getting a formal appraisal first. I just used the county tax assessment and comparables from Zillow to estimate the value at time of death. When I filed taxes, nobody questioned it. BUT - and this is a big but - my tax guy said I was taking a risk. If I get audited within the next few years, I could have problems. So it depends on your risk tolerance. Formal appraisals cost $300-500 but potential tax headaches and penalties could cost WAY more.

I'm going through a very similar situation right now with my late father's property in Texas. Based on what I've learned from my estate attorney, you absolutely need proper documentation of the stepped-up basis - it's not optional if you want to avoid potential tax issues down the road. Here's what I'd recommend for your timeline: Get a quick CMA (Comparative Market Analysis) from a realtor this week before you fly down, then when you're in Florida, have a licensed appraiser do a retroactive appraisal as of your grandmother's date of death. Most appraisers can do this and will note in their report that it's for estate tax purposes. The $200-400 you'll spend on the appraisal could save you thousands in capital gains taxes or penalties if you're ever audited. Since you mentioned the house is worth around $320k vs the original $85k purchase price, proper documentation of that stepped-up basis could save you about $35,000 in capital gains taxes (assuming you're in a higher tax bracket). Don't cut corners on this - the IRS is pretty strict about inheritance documentation, especially on higher-value properties. Good luck with the sale!