How to Sell Inherited Land

Selling Inherited Land: What You Need to Know

Inherited land is one of the most commonly sold types of vacant property in the United States. According to a 2023 Federal Reserve study, an estimated $84 trillion in wealth will transfer between generations by 2045, a significant portion of which includes real property. Many heirs inherit land they have never visited, cannot use, and do not want to maintain. Selling inherited land for cash is often the simplest solution.

Reelvest Properties frequently purchases inherited land. Many of the company's 400+ transactions since 2020 involved sellers who inherited vacant land in a state where they do not live. The process of selling inherited land is straightforward, but there are specific steps involving probate, title transfer, and potential tax implications that sellers should understand.

Do You Need Probate to Sell Inherited Land?

Whether probate is required depends on how the property was owned and the state where it is located. In many cases, probate is necessary before inherited land can be sold. However, some situations allow you to skip probate entirely.

Probate is NOT required if:

• The property was held in a living trust
• The property was owned as joint tenants with right of survivorship (and the surviving owner is selling)
• The property was owned as community property with right of survivorship (in community property states)
• A transfer-on-death deed was filed (available in about 30 states)
• The estate qualifies for a small estate affidavit (typically for estates under $50,000-$150,000 depending on state)

Probate IS required if:

• The property was solely in the deceased person's name
• There is no will and the property must pass through intestate succession
• Multiple heirs have claims to the property

Cash land buyers like Reelvest Properties can purchase inherited land even if probate has not been completed. Reelvest works with the seller and their estate attorney to coordinate the probate process alongside the land transaction, which can save significant time.

Steps to Sell Inherited Land

1. Determine who legally owns the property. Review the deed, will, or trust documents. If there are multiple heirs, all owners must agree to sell (or a partition action may be necessary).
2. Check for probate requirements. Consult with a probate attorney in the state where the land is located. Many offer free initial consultations.
3. Research the property's value. Check comparable sales in the county, review the tax assessment, and consider whether the land has road access, utilities, and buildable zoning.
4. Decide how to sell. You can list with a land agent (6-24 months), sell by owner, or sell to a cash land buyer like Reelvest (14-30 days).
5. Clear any title issues. Inherited properties sometimes have title issues such as old liens, unpaid taxes, or unclear ownership chains. A title company or the buyer's team will identify and help resolve these.
6. Complete the sale. Sign closing documents, and the title company transfers ownership. You receive your payment at closing or within a few business days.

Tax Implications of Selling Inherited Land

When you inherit land, you receive a "stepped-up basis" for tax purposes. This means the property's tax basis is adjusted to its fair market value at the date of the deceased person's death, not the original purchase price. This can significantly reduce or eliminate capital gains tax.

Example: Your parent purchased land for $5,000 in 1990. At the time of their death in 2024, the land was worth $40,000. Your stepped-up basis is $40,000. If you sell the land for $42,000, you only owe capital gains tax on the $2,000 gain — not on the $37,000 difference from the original $5,000 purchase price.

If you sell the inherited land shortly after receiving it, the capital gains tax is often minimal or zero because the sale price is close to the stepped-up basis. Consult a tax professional for advice specific to your situation.

Your Options: Cash Buyer vs Agent vs FSBO

Frequently Asked Questions