Hello,
I am at the end of a FEMA involuntary conversion buyout program and there seems to be confusion from the closing attorney as they initially were going to give me a 1099 like a normal real estate transaction. I have pointed out that is should be treated as an involuntary conversion for tax purposes which has now delayed the closing. To make sure it is not improperly reported to the IRS, can you advise what I should be receiving if anything? I have reviewed the FEMA HMA guide but it does not specifically specify tax documentation, only that it is not taxed. I am uncertain if I should be receiving a 1099-S, or if the city (sub-recipient) should report the cost in the SOW they are submitting to FEMA.
