Hello, I sold a rental property at the tail end of 2025. As part of the sale, the January Rent was credited to the new buyer. In Jan 2026 I got the rent as usual to reimburse the credit.
The rent was being paid by section 8 housing assistance. So next year (2027) I will get a 1099 from them for 1 months rent even though I no longer owned the property in 2026. This payment is a wash for me so how do I handle it going forward? Should I somehow handle it as part of the property sale, otherwise it will be reported as rental income for 2026.
I want to avoid paying income tax on it next year since it is just a reimbursement of the credit.
Thanks!
