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jomcap
New Member

My husband and his brother were on the house there mother owned. when it sold the check was split into two half to each brother. How do they file that?

 
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11 Replies

My husband and his brother were on the house there mother owned. when it sold the check was split into two half to each brother. How do they file that?

Depends ... if they each got a 1099-S for their 1/2 of the sale then they will each report their 1/2 of the sale on their tax returns. As to the basis they use ... that depends on if they inherited the home, it was gifted to them or if mom kept a life estate on the property.
kzppffdd
Returning Member

My husband and his brother were on the house there mother owned. when it sold the check was split into two half to each brother. How do they file that?

same situation here, my mom held life estate and is still alive living with me and she received all funds being deposited in her savings.  How is that treated.

kzppffdd
Returning Member

My husband and his brother were on the house there mother owned. when it sold the check was split into two half to each brother. How do they file that?

In our case the 1099 S shows only Gross Proceeds.

ThomasM125
Expert Alumni

My husband and his brother were on the house there mother owned. when it sold the check was split into two half to each brother. How do they file that?

You need to determine what the cost basis of the house was. If the owners purchased the house, the cost basis would be the purchase price plus cost of improvements plus expenses of selling it. If the house was inherited, substitute the fair market value of the house for the purchase price.

 

Enter each owner's share of the sales proceeds as the sale amount, and enter their cost basis as such and the difference will be a gain or loss.

 

If the house was the owner's principal residence, enter the sale in the "Sale of Home" income section in TurboTax under "Less Common Income."

 

If the owners didn't live in the house, enter the sales as follows:

 

1. Go to the "Federal" section of TurboTax and click on  "Income and Expenses"

2. Look for "Investment Income" and click on "Stocks, Mutual Funds, Bonds, Other"

3. Answer "No" to the question about receiving a form 1099-B

4. When asked what type of investment sold? answer "Second Home"

5. Enter the property address of the house sold and the proceeds reported on the 1099-S

6. Indicate that you inherited the home if you did

7. Enter the date and fair market value of the home when you inherited it, or the cost if you purchased it

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kzppffdd
Returning Member

My husband and his brother were on the house there mother owned. when it sold the check was split into two half to each brother. How do they file that?

My mother retained a life estate in the house.  My brother and I were listed on the deed as owners with her having the life estate.  We both received a 1099S showing our share of the sale as Gross Proceeds.  My mom is still alive living with me and she received all the funds from the sale.  How do we handle this?

DianeC958
Expert Alumni

My husband and his brother were on the house there mother owned. when it sold the check was split into two half to each brother. How do they file that?

Since the house was sold while your mother still lives, the value of the proceeds would be divided between  the life tenant (your Mom) and the remainderman (you and your brother) according to IRS actuarial tables. 

 

 You and your brother are not eligible for a capital gains tax exclusion on your portion unless you met the IRS requirements for the exclusion, which include having lived in the home as your primary residence for two of the past five years.  Your mother would qualify for the capital gains exclusion up to $250,000 if she owned the home at least 5 years and lived in it for at least 2 of those 5 years.

 

Even though you did not receive any of the proceeds from the sale the 1099-S form still needs to be reported on your tax return.

 

You may want to consult a tax preparer that is well versed in this type of situation so that you prepare your returns accurately.

 

 

 

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My husband and his brother were on the house there mother owned. when it sold the check was split into two half to each brother. How do they file that?

I'm in same situation needing to enter my husband's Substitute Form 1099-S for sale of inherited father's home. After researching in Turbo Tax, I upgraded to Turbo Tax Premier as directed, but when I'm in "Investment Income", it asks, "Did you sell any investments in 2020?" (and it shows Forms covered in this section: 1099-B, 1099-S, brokerage statements) I say YES. 

Then asks "Did you get a 1099-B or a brokerage statement for these sales?", I say NO. 

I never get the question #4 you state of "What type of Investment Sold?".

 

How do I get to part to fill in info from my Substitute Form 1099-S? If I just enter a sale, as it directs me to, the box #'s don't correlate to my Form as they appear to be for stocks.

Thank you for your help. 

PattiF
Expert Alumni

My husband and his brother were on the house there mother owned. when it sold the check was split into two half to each brother. How do they file that?

The question "What type of investment did you sell" is in the online program. It would appear that you are using the CD/Download version of TurboTax.

 

To enter the 1099-S, continue to the question that you mentioned, "Did you get a 1099-B or brokerage statement for these sales?"

  • click on NO.

 

You can enter the information starting with the screen Tell us about this sale

  • I'll enter one sale at a time
  1. Enter Description
  2. Date Sold
  3. Date acquired
  4. Sales proceeds
  5. Cost or other basis 
  6. Holding period
  • Short term (held for less than a year)
  • Long term (held for more than a year)

That should record the sell reported on the 1099-S.

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My husband and his brother were on the house there mother owned. when it sold the check was split into two half to each brother. How do they file that?

Thank you pattif12! Yes I'm on the download version.

That's what I originally did, but when I wanted to confirm I was handling it correctly, and saw others questions & answers, I thought I was going crazy when I wasn't getting that question. 🙂

8Xbehabob
Returning Member

My husband and his brother were on the house there mother owned. when it sold the check was split into two half to each brother. How do they file that?

My brother and I inherited my mother's house and the rental house next door that she owned last year when she died.  She had deeded both properties to us in 2007 after our father died, retaining a life estate in them.   We sold both properties last year and received a 1099-S for both of them.  How do we claim this on our 2020 returns?

ToddL99
Expert Alumni

My husband and his brother were on the house there mother owned. when it sold the check was split into two half to each brother. How do they file that?

Each property sale is reported separately in the Stocks, Mutual Funds, Bonds and Other interview under Investment Income. Both would be considered "second homes" or "inherited homes".

 

The cost basis for each house would be the fair market value (FMV) of the house at the time of your mother's passing.

 

For instructions on making the entries, see Where do I enter the sale of a second home, an inherited home, or land on my 2019 taxes?

 

And, our sincere condolences for the loss of your mother.

 

 

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