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Get your taxes done using TurboTax
It sounds like the utility company issued a 1099-S because the payment was classified as a real estate transaction, even though it was for a Temporary Construction Easement (TCE). This is not likely an error unless the payment permanently transferred property rights.
Since the Temporary Construction Easement (TCE) payment is reported on Form 1099-S, but functions like rental income, it should be reported on Schedule E (Supplemental Income and Loss),
Here's how you can report this income in TurboTax:
- Log into TurboTax once logged in, click on the link in step 2.
- Click on Rentals, Royalties, and Farm" and
- Click "Add a New Rental Property
- If you have not previously reported rental income, select "Yes" to add a property.
- If asked, select "Land" or "Other" if the easement isn't related to an existing rental property.
- Enter Rental Income
- In the Rental Income section, click "Other Income" (not regular rent).
- Enter the amount from Form 1099-S as the easement payment.
- Enter Any Expenses (if applicable): If you incurred expenses (e.g., legal fees, property maintenance related to the easement), enter them in the Rental Expenses section.
- Skip Depreciation (Unless Rights Were Permanently Transferred)
- If the easement was temporary, don't enter depreciation.
- If property rights were permanently transferred, adjust the cost basis accordingly
- [Edited: 1/28/25 l 9:14PM PST] @Zapit
‎January 27, 2025
8:41 PM