Form 1099-S (2024)

FAQs

What gets reported on a 1099-s? ›

Use Form 1099-S to report the sale or exchange of real estate.

Form 1099-S reports the date of sale and the gross proceeds of the transaction, and it has been sent to the IRS, so a taxpayer who has received one must report it on their tax return. Sale of business property is reported on Form 4797, otherwise the transaction is reported on Form 8949.

If you already mailed or eFiled your form 1099's to the IRS and now need to make a correction, you will need to file by paper copy a Red Copy A and 1096, fill out and mail to the IRS, if you need further assistance preparing your corrected paper copy, please contact your local tax provider or call the IRS at (800) 829- ...

If you fail to file any type of 1099 form, the IRS can technically start issuing penalties starting at $250 per failure to those who don't follow through with this requirement (that is, if they ever find out about it).

The IRS knows about any income that gets reported on a 1099, even if you forgot to include it on your tax return. This is because a business that sends you a Form 1099 also reports the information to the IRS. The IRS cross-references tax returns with other income records that businesses submitted.

When you sell your home, federal tax law requires lenders or real estate agents to file a Form 1099-S, Proceeds from Real Estate Transactions, with the IRS and send you a copy if you do not meet IRS requirements for excluding the taxable gain from the sale on your income tax return.

Report the sale on Schedule D (Form 1040), Capital Gains and Losses and on Form 8949, Sales and Other Dispositions of Capital Assets: If you sell the property for more than your basis, you have a taxable gain.

Sale of a timeshare or vacation home: A timeshare or vacation home is considered a personal capital asset and the sale is reported on Schedule D Capital Gains or Losses. A gain on such a sale is reportable income. If you incurred a loss on the sale, the IRS doesn't allow you to deduct the loss.

Additionally, a 1099S is not required for the sale or exchange of a principal residence with gross proceeds of $250,000 or less ($500,000 or less for married filing jointly) if an acceptable written assurance (certification) from the seller is obtained that indicates the full gain is excludable from the seller's gross ...

Often you will receive a Form 1099-S reporting this sale. Usually, when you inherit a home and it is sold right away, there is little to no gain. However, you will still need to report it on the Stocks or Investments Sold screens in our software. The cost basis is the fair market value of the home on the date of death.

What are exceptions to the 2 year capital gains rule? ›

A change in the place of employment for you, your spouse, any co-owner of the property, or any other person who uses your home as their principal residence is always a valid excuse if the location of the new job is at least 50 miles further away from your old home.

The sales price is the gross proceeds you received in giving up the property. That's the amount that was paid down or paid off, plus any other consideration you received in the transaction. Compute your gain or loss in the usual way — Sales price minus your adjusted basis in the property.

Penalties for Correcting a 1099 Form

A business generally must pay $100 per incident. The business may also pay a separate $100 fee after the IRS sends a statement to any taxpayer who received an incorrect tax form. Keep in mind that submitting a form with the wrong information is not the only type of error.

Depending on who handles the closing of a property sale in your state you may or may not receive a Form 1099-S. Speak to your closing attorney or realtor to see if a 1099-S is being sent. But do not request one if not needed.

The sales price is the gross proceeds you received in giving up the property. That's the amount that was paid down or paid off, plus any other consideration you received in the transaction. Compute your gain or loss in the usual way — Sales price minus your adjusted basis in the property.