1099-S

[kmdurso]

I sold my rental property in 2019.  What sales price do I list if the sales information segment of TurboTax?  Is this the Gross Proceeds box 2 from form 1099-S?

[HelenC12]

Yes, you would enter the gross sales proceeds. There's another line for sales expenses.

• Click here for instructions and screenshots on how to enter your rental sale. 

Tip: Take your time and pay close attention. There's a lot of info and it's easy to miss if you're in a hurry.

Terminology Tips

• Sales Price – If you received a Form 1099-S, look in Box 2 (Gross Proceeds), which will generally be your contract sales price. You can also use the gross proceeds amount from your settlement closing statement.
• Sales Expenses for selling your property include sales commissions, advertising, broker and legal fees, and transfer taxes.
• Basis is your rental's original purchase price plus settlement costs at time of purchase (abstract, legal and recording fees, surveys, transfer taxes, and owner's title insurance).
• Adjusted basis is your basis plus improvements and sales expenses minus depreciation.

Source: TurboTax FAQ

[Carl]

Is this the Gross Proceeds box 2 from form 1099-S?

Sorry, but that abount in box 2 could very possibly be the wrong amount. Many issuers fill it out incorrectly and do not include amounts used by the closing agent to pay off existing mortgages. It's more common for the 1099-S to only show the cash payout to you after expenses. (Such as the payoff of an existing mortgage).  Additionally, the 1099-S instructions for the issuer clearly state, "Gross proceeds do not include the value of property or services received or to be received by, or on behalf of, the transferor or separately stated cash received for personal property, such as draperies, rugs, or a washer and dryer." So chances are the amount will be wrong when it comes to your sales price.

Your sales price is the price you sold the property for as documented in the sales contract that you and the buyer both agreed to.  While it is possible, it is *EXTREMELY* *RARE* for the 1099-S box 2 to actually agree with the sales price the seller and buyer agreed to in the sales contract they both signed.

[tagteam · Accepted solution]

Gross proceeds means any cash received or to be received for the real property by or on behalf of the transferor, including the stated principal amount of a note payable to or for the benefit of the transferor and including a note or mortgage paid off at settlement. If the transferee assumes a liability of the transferor or takes the property subject to a liability, such liability is treated as cash and is includible as part of gross proceeds.....

Do not reduce gross proceeds by any expenses paid by the transferor, such as sales commissions, deed preparation, advertising, and legal expenses. If a closing disclosure is used for a transfer of real estate for cash and notes only, gross proceeds generally will be the contract sales price shown on that statement.