House was deeded to one heir, the other wants her "share". Any advice?

My father deeded the house over to meso that it would not be part of the estate. My sibling had POA to handle the bills and bank account; needless to say my father died completely broke and in debt due to being a co-signer on loans and credit cards had been run up after my father fell ill.

Now that my father has passed and the house has been sold, my sibling is demanding 1/2 of the money. The money is MINE since that is the person responsible for taxes, taking care of the property and such. The basic fact is, the other signed away all rights to the home. It's all in black and white (and filed with the courts).

I could give my sibling some but I really hate the idea of giving a "gift", especially since there's been a whole bunch of "gifting" going on over the past few years. Is there a way I give them a 1099 or something to make sure anything I may give is income?