You might check with the utility company to confirm this is a temporary easement. If so, treat the amount on the 1099-S as rental income, with sufficient backup (copies of correspondence) to prove the true character of the income. You should also request the correct Form 1099-MISC.
The only advantage of a permanent easement on Form 1099-S is that you can adjust your basis in the square footage of your property. If the adjustment is at least as much as the amount on the 1099-S, you would not report any income.
@Zapit
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
