Do I pay capital gains tax on an inherited home?

Capital gains tax on an inherited home applies only to appreciation that happens after you inherit it, because the property's tax basis resets to what it was worth around the time the previous owner died. That reset means many heirs who sell soon after inheriting owe little or nothing in gains tax, while a home held for years can build up a taxable gain. The exact figure depends on the appraisal at death and the eventual sale price, so a CPA should run the numbers.