Each person is supposed to report their share of the sales proceeds. According to the IRS, separate Forms 1099-S should have been prepared showing each owner’s share of the proceeds. If you receive one 1099-S from the title company for the full amount of the sale, you may wish to request that they allocate the amount and provide one form for each owner instead.
The sale of investment property is reported as Investment Income (Stocks, Mutual Funds, Bonds, Other) under Wages & Income in the Federal Taxes section of TurboTax. The expenses from your HUD-1 are reported in this same section.
Each of you may report 33.3% of the proceeds and use 33.3% of the basis (value of the property) to compute the taxable capital gain or loss that should be allocated to each owner.
