IRS Form 1099-S Certification Exemption Form

Forum|Forum|3 years ago
June 8, 2023
3 replies
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I inherited 50% of a house and I am selling it. Neither of us has ever lived in it but we did rent it out. How do I fill out the above IRS form? I have no idea since the form is for the sale of a principal residence. I never lived in it. The escrow company sent this form.

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rjs

Level 15

You don't fill out the form. The escrow company has to file the Form 1099-S for the sale. You are not exempt from getting the 1099-S or from reporting the sale.

Critter-3

Level 15

The 1099-S is for the sale of ANY real property and you will NOT enter the form in the program but you will use the information on the closing statement in the asset section of the Sch E area of the interview ... you will indicate it was sold and in the asset section you will "sell" off all the assets ... if you have NOT been claiming depreciation on the assets in the past then RUN to a local tax pro to get this issue corrected properly ... the form 3115 is NOT a DIY project.

See this TurboTax support FAQ for the sale of a rental property - https://ttlc.intuit.com/turbotax-support/en-us/help-article/real-property/sold-rental-property-repor...

Hal_Al

Level 15

The closing agent issues form 1099-S to let the IRS know you received money from a sale of real estate, just like your employer issues a W-2 for wages and a bank issues a 1099-INT for interest paid.

You need to report the sale on your tax return. You can adjust the amounts, for the fact that you only sold half. As others have said, there is no specific place, in TurboTax (TT), to enter a 1099-S. You use the info to report the sale of your rental property. After answering yes, in TT, that you sold your rental, TT may ask about the 1099-S.

Opus 17

Level 15

The other experts have not addressed the “1099-S exemption certificate.“ This is your opportunity to certify to the closing agent that you are exempt from capital gains tax and that therefore, the closing agent is not required to issue the 1099-S.

(The IRS requires that a 1099S be issued unless the seller meets certain qualifications. The certificate is used by the closing agent to record your information claiming exemption, that they keep on file in their records in case they are audited by the IRS for failing to issue 1099s.)

Since you are not exempt from capital gains tax on the sale of this house, you simply don’t fill out the exemption certificate. (Alternatively, answer "False" to question 1, "I used the home as my principal residence" and leave the other answers blank.) The closing agent will issue a 1099-S at the closing.