Trying to enter a 1099S real estate form and when I follow the instructions it appears as a 1099B sale of stock and that isn't right?

[gsteph50]

Home was inherited and sold.

[Anonymous_ · Accepted solution]

When you get to the screen in the screenshot below, click the "No" button.

[Bsch4477]

The sale is reported on Sch D just as a stock sale which is reported on 1099-B would be. Remember to report “inherited “ for date acquired and cost is the fair market value at the time of the decedent’s death. So if it was sold soon after death there would be no tax liability. 

[gsteph50]

No idea how to get to that page.

[Anonymous_]

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@gsteph50 wrote:

No idea how to get to that page.

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Stocks, Mutual Funds, Bonds, Other in the Investment Income section.

[gsteph50]

That's where I'm inputting the information and it shows up as a 1099B rather than the 1099S I'm trying to input. Shouldn't there be an actual 1099S?

[Anonymous_]

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@gsteph50 wrote:

Shouldn't there be an actual 1099S?

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No, there is no 1099-S formatted input in the program.

[KrisD15]

The Title Company (or whomever closed the sale) uses a 1099-S because that is the form the IRS issued for their use.

It's a form used to report real estate transactions. 

A sale of property can result in several different tax situations. 

In your case, it is a capital gain (or loss) so the sale of that property is transferred to a 1099-B allowing the IRS computer to do the math for that transaction. 

It also gives a "match" for the IRS to use against their copy of the 1099-S. 

[KJM115]

My sister and I inherited my mom's house upon her death in April '22. It had a FMV of 260,000 we sold it for 240,000 (lost) to a friend of hers in Dec '22. We will get to take a lost of the 20,000 (10,000 apiece)?

[DianeW777]

Yes, if neither of you used your mom's house as your main home. 

The sale of this house would be reported on Schedule D as an investment sale if inherited and it was not your main home.  In other words you did not use this as your main home.

If this is considered investment property, report the sale using the steps below:

1. Under Wages & Income scroll to Investments & Savings
2. Select Start/Revisit beside Stocks, Cryptocurrency, Mutual Funds, Bonds, Other (1099-B)
3. Select Add Investments or continue to go through the screens to select 'Other' > Continue
4. Begin to enter the sale description >  Under Type select Other > Under How did you receive select 'I Inherited it' (if applicable)
5. For TurboTax Desktop you would enter the description 'Inherited Property' and select 'Long Term' as the hold period
6. Enter your sale date and 'Various' as the Acquired date and use the actual sale date
7. Continue to complete the screens until you arrive back at the Wages & Income main page.

Inherited property is always considered to have a long term holding period which provides favored tax treatment.

Cost basis for inherited property, if you were not a previous owner (name on property before the death of your parents), is the fair market value (FMV) on the date of death.  If the sale occurs relatively soon after the death of the owner then the FMV would be very close to the selling price as a rule. Check with the executor or a real estate company or the court records for other sales of similar property if necessary.

@KJM115 

[Anonymous_]

Assuming you and your sister held the house as investment property (i.e., you did not hold if for personal use), you should be able to recognize a loss on the sale.