When a family inherits a home, one of the first things the attorney or CPA usually asks for is the property’s value on the date of death. It can feel like one more task during a difficult time, but this number can have a big impact on taxes and on how the estate is divided. Here’s what a date-of-death valuation is and how to get one in Colorado.
Please note: I’m a real estate broker, not an attorney, appraiser or tax advisor. Confirm what your estate needs with your probate attorney and CPA.
What is a date-of-death valuation?
It’s an estimate of what the home was worth on the day the owner passed away, not what it’s worth today. Because the market changes, a home’s value at the date of death can be quite different from its value months later when the estate is ready to sell.
Why it matters
- Stepped-up tax basis: Under federal tax rules, inherited property generally receives a new cost basis equal to its fair market value at the date of death. If heirs later sell, capital gains are usually measured from that value, not from what the original owner paid decades ago. A well-documented value can save heirs significant taxes.
- Estate inventory: The Personal Representative typically needs to list estate assets and their values.
- Dividing the estate fairly: If one heir keeps the home and buys out the others, everyone needs a fair, neutral number.
Colorado does not have a state estate or inheritance tax, but federal rules still apply, so the valuation matters even for modest estates.
Appraisal or broker’s opinion?
There are two common options:
- A retrospective appraisal from a licensed appraiser, who looks back at comparable sales around the date of death. This is often what attorneys and CPAs prefer for tax documentation, especially for higher-value estates.
- A broker’s market analysis based on comparable sales. This is a helpful, free starting point for planning, pricing and family discussions.
Ask your attorney or CPA which one your estate needs. Many families start with a broker’s analysis and then order a formal appraisal if needed.
What you’ll need
- The property address and date of death
- Details about the home’s condition at that time (photos help)
- Any updates, repairs or known issues
Tips from experience
- Don’t wait too long. It’s easier to document condition and comparable sales soon after the date of death.
- Take photos before cleanout or repairs. They show the home’s condition on the valuation date.
- Keep everything in writing for the estate file.
We can help
We provide free date-of-death market analyses for Colorado families and work with appraisers and probate attorneys we trust. Read our guide to selling a home in probate and your options for an inherited house, visit our probate page, or call us at (720) 403-2940.