How to Avoid Paying Capital Gains Tax on Inherited Property is a frequently asked question by people who have property that they want to pass onto their children or heirs. This is so common nowadays because of how inheritance taxes can be very burdensome for people. Even with estate planning, many people find themselves stuck paying capital gains tax on property they will never use. The good news is that if you have property you want pass on to your child or heirs, there is a solution that doesn't require you to pay taxes on it at all.