How Do I Report a 1099S on Tax Return?

The sale of real estate results in a short or long-term capital gain.
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Internal Revenue Service (IRS) form 1099-S is the form the federal government requires to be filed when selling real estate. If you sold any real property during the course of the year, you must will receive a form 1099-S unless you produce a certification that the property sale was an excepted sale.

Determine the Responsible Party

The individual responsible for closing the transaction is the party responsible for filing form 1099-S with the IRS and sending a copy to the seller. Generally this is an attorney for the transferee or transferor or the title agent handling the escrow for the transaction. Alternatively, the responsible party can be designated in a written agreement.

What To Do With the Form 1099-S?

As a property seller, you will use the information from the form 1099-S along with the settlement statement from the sale of your real estate to report a capital gain or loss. You will need to complete IRS Schedule D and Form 8949, which will then transfer to Form 1040, line 13.

Short or Long Term Capital Gain

If you held title to the real estate for more than one year before the sale date, then you have a long term capital gain or loss. If less than one year, the gain or loss will be short term.

Excepted Sales

You may not receive a form 1099-S for the sale of your principal residence if you lived there for two of the last five years and the sales price was less than $250,000 if single or $500,000 if married.

Reportable Sales

If you sell rental property, commerical property or vacant land, you should receive form 1099-S from the closing attorney or escrow agent on or after the closing. The agent may give you the form 1099-S at closing or anytime before the following January 31.

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