non-resident sale 1099-S

[Sgrhgrmn]

My wife and her Mother and her Brother split the sale proceeds of her Grandmother's house after her death.  My wife received a 1099-S for gross proceeds of $9,166.67 which is 1/3 of the sale price of $27,500.  We are filing a joint 1040 and would like to know how to report this 1099-S.  I have searched everywhere on the IRS website but can't find anything regarding this situation.

[tagteam]

Follow the instructions in the TurboTax Help article (link below).

https://ttlc.intuit.com/community/entering-importing/help/where-do-i-enter-the-sale-of-a-second-home...

[Hal_Al · Accepted solution]

The cost basis in an inherited home is the fair market value on the date of death.  This often results in there being a capital loss when the house is sold.  The loss on the sale of personal use property, like a 2nd home. is not deductible.

However if the home sat vacant between the date of death and being sold, it is classified as investment property and any loss is a deductible capital loss.  Do not identify it as a 2nd home in the interview.

[Sgrhgrmn]

Thanks for the reply.  The house was vacant for a couple of years before it was sold.  I don't know how this would work as a capital gain/loss.  Is there a schedule or form or worksheet that I could fill out.  This amounted to an inheritance.  I still don't know where to report this.

[tagteam]

@Sgrhgrmn In TurboTax, you can report the transaction in the Investment Income section under Stocks, Mutual Funds, Bonds, Other.

When proceeding through the interview ensure that you indicate you did not receive a 1099-B and select Everything else as the type of investment you sold.

[Sgrhgrmn]

Thanks.  I'll try and struggle through though I don't see why there can't be an obvious way to do this.

[jpgolfer52]

I sold my mother's house about 5 months after her death.  The proceeds of the sale were split with my brother.  I received a 1099S for the full value of the house.  How should this be reported?  The house sat empty for 5 months.  

[tagteam]

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@jpgolfer52 wrote:

I sold my mother's house about 5 months after her death.  The proceeds of the sale were split with my brother.  I received a 1099S for the full value of the house.  How should this be reported?

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You would have to report the entire proceeds and then indicate that you received one-half as nominee for your brother (i.e., essentially subtract one-half from the total).

TurboTax does not actually support this type of transaction (although it can be accomplished in Forms Mode if you are using a desktop version of TurboTax).

[Hal_Al]

@jpgolfer52  You should report the full 1099-S,  on your return,  so your return matches the IRS data bank. Adjust (change) your cost basis so that you report only your share of the gain or loss.

Your brother has it easier, he reports his actual numbers.