No Colorado inheritance tax
Inheriting a House in Colorado: Taxes and Selling
Colorado has no inheritance tax or estate tax.
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No state estate tax
Do you pay tax when you inherit a house in Colorado?
Colorado has no inheritance tax and no estate tax (Colorado Legislative Council Staff). The federal estate tax applies only above $15,000,000 per person for 2026 deaths (IRS). An inherited house takes a basis equal to its value on the date of death, so a prompt sale produces little or no capital gain (26 U.S.C. 1014).
None.
Colorado has no inheritance tax and no estate tax.
Steps up.
The tax basis resets to the value on the date of death.
Who signs.
The personal representative, the trustee or the deed beneficiary.
List early.
The home can sell while the 4-month creditor window runs.
Is there a federal estate tax on a Colorado estate?
- No Colorado inheritance tax. No Colorado estate tax. The state repealed its estate tax in 2005 (Colorado Legislative Council Staff).
- Federal estate tax starts above $15,000,000 per person for 2026 deaths (IRS).
What is a stepped-up basis?
- Your basis is the home's fair market value on the date of death (26 U.S.C. 1014).
- Example: your parents paid $300,000 in 1995. The home is worth $1.2 million at death. You sell for $1.2 million. Your gain is near zero before selling costs.
- Get a date-of-death value in writing. An appraisal or our Smart Pricing Report documents it.
- This is not tax advice. Your CPA runs your numbers.
Who has the right to sell it?
- In probate: the personal representative the court appoints.
- With a beneficiary deed on record: the named beneficiary, outside probate.
- In a trust: the trustee.
- Colorado's small estate affidavit does not transfer real estate (Colorado Judicial Branch, JDF 999).
How long before we can close?
- The personal representative can list during probate.
- Creditors get at least 4 months after the first published notice to file claims (C.R.S. 15-12-803).
- Your probate attorney confirms when proceeds can be distributed.
Sell, keep or rent?
- Sell: use the stepped-up basis and split cash among heirs.
- Keep: every heir agrees in writing on who pays taxes, insurance and repairs.
- Rent: you take on landlord duties, and future gain is measured from the date-of-death value.
What do we do first?
- Lock the house, keep utilities on and call the insurer about vacancy.
- Do not clear out belongings until the inventory is done.
- Get a date-of-death value, then decide: sell, keep or rent.
- Keep every bill you pay for the house. The estate reimburses or credits them.
The bills keep coming
What does an inherited home cost to carry until it sells?
Until closing, the estate pays to own the house. On a luxury home those costs add up fast, which is one reason many heirs list once Letters are issued instead of waiting for probate to finish.
| Cost | Who pays | What to watch |
|---|---|---|
| Property tax | The estate | Keep paying on schedule; the title company prorates it at closing |
| Homeowner's insurance | The estate | Tell the insurer the home is vacant; many policies change after 30 to 60 days empty |
| Mortgage or reverse mortgage | The estate | Call the servicer early; a reverse mortgage comes due after the death |
| HOA dues | The estate | Unpaid dues become a lien paid from the sale |
| Utilities, snow removal, yard care | The estate | Keep heat on in winter to prevent frozen pipes |
Keep every receipt. The estate reimburses heirs who pay these bills, and the closing statement shows what was paid from the sale.
We are real estate agents, not attorneys or tax advisors. This is general information, not legal, tax or financial advice. Probate rules and court timing change; the estate's attorney and CPA confirm what applies to you.
Should the estate sell as-is or update first?
- Price both. We show the as-is price and the price after a deep clean, paint and landscaping, with the cost of each.
- Skip the remodel. Kitchens and baths rarely pay back for an estate, and every month of work is another month of carrying costs.
- Get an inspection first on an older home, so the heirs know about the roof, sewer line or furnace before a buyer finds them.
Where do heirs go from here?
- Probate, trust or beneficiary deed: see how an inherited luxury home gets sold, with the step-by-step timeline.
- Owned it for decades yourself? Read selling a home you've owned 15+ years and capital gains on a Colorado home sale.
- A home under one million dollars? kennarealestate.com has a free Colorado inherited-home checklist and probate help for estate homes at every price.
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Quick answers
Questions, answered.
Does Colorado have an inheritance tax?
No. Colorado has no inheritance tax and no estate tax (Colorado Legislative Council Staff).
Do I pay capital gains on an inherited house?
Only on gain above the date-of-death value (26 U.S.C. 1014). A prompt sale carries little gain. Ask your CPA.
Can I sell an inherited house before probate closes?
Yes. The personal representative has authority to sell during probate. Your attorney sets the timing for paying out proceeds.
Who pays the bills on an inherited house before it sells?
The estate pays the property tax, insurance, mortgage, HOA dues and utilities. Heirs who pay out of pocket keep receipts and are reimbursed from the estate.
What is a personal representative's deed?
It is the deed the personal representative signs to transfer an estate home to the buyer at closing. The title company or the estate's attorney prepares it.
Can the house sell during the creditor claims period?
Yes. The personal representative can sell while the at-least-4-month claims window runs. The proceeds stay in the estate until the attorney says claims are settled.
Sources
Where the numbers come from.
Free playbook
The Colorado Luxury Downsizing Playbook.
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Kenna Luxury Real Estate is a division of The Kenna Group at Keller Williams DTC (KWDTC).