As expected. I got a hold of the closing agent at the law firm doing our closing and she told me the amount on the 1099-S will be the purchase price. And really the purchase price is what would always be used because that is what gross proceeds are, anything less then that received by the seller would be called net proceeds. Even then she told me the gift of equity would not reduce net proceeds because the way these transactions are done it is as if the seller receives the money first and then they give the gift of equity, and that there is nothing I could do to have it “corrected” because it is correct. She told me the IRS requires them to report on the purchase price.
so let me ask you all again, do you all “REALLY” know what you are talking about here? Have any of you actually been through this or are you just taking an academic approach to this?
