The IRS is claiming that a primary residence I sold in 2018 is 100% gain PLEASE HELP!

[nickweems]

I owned a house in 2018 that I had lived in for 3.5 years. I bought the house in 2015 for $300k and sold it in 2018 for $350k. I received a letter in the mail stating I didnt claim a $350k profit on the house and the tax liability is somewhere in the $150k range. I sent a response with a statement stating that this was my sole and primary residence, a copy of the HUD-1 statement from the purchase of the property, and the final settlement statement from the sale of the house which easily shows the gain was only $50k from the property. I received another letter today stating that, from what I sent, there is no sufficient evidence and Im still liable for $350k of income. This is truly outrageous as I provided itemized evidence and a coherent explanation. What do I do now? It seems like they are trying to strong arm me and it feels criminal. Any advice would be greatly appreciated. Thanks

[Carl]

Visit your local tax advocacy office. To find the office closest to you, visit https://www.taxpayeradvocate.irs.gov/contact-us/

[Critter-3]

Your response was not sufficient  and it was dismissed.   You must have gotten a form 1099-S from the sale and  failed to enter it on the original tax return and then when presented with the IRS CP2000  notice  you did not respond appropriately so they ignored your response.  This is a time where doing this yourself is ill advised so getting local professional assistance would be wise if the tax payer advocate or the local IRS office cannot help.  Sadly you may have run out of time to fight the IRS determination and/or you may need to go to tax court.   

[nickweems]

I never received a 1099-S notice...and from what I understand they wouldnt issue one if it was under $250k in profit. They sent another reponse and are allowing me to reply, with 'sufficient evidence' that I only profited off my sole and primary residence $50k, by MAY 8. My question is how do I go above providing them with copies of original HUD-1 and final settlement statements from the sale. The address was listed on my Drivers License, Tax return address, and voters registration during that period.

[Mike9241]

many TAS offices are closed. 

this is from the IRS website

COVID-19 Response: Limited Services and Delays due to Coronavirus
All in-person TAS offices are closed. However, TAS remains committed to assisting taxpayers and championing their taxpayer rights.

Refund delayed? Our ability to help may be limited
For answers to common tax questions, see our Get Help section on the TAS website
Contact us to see if we can help with your tax issue
For COVID-19 tax relief information, see IRS Coronavirus Relief and Economic Impact Payments

did you report the sale on schedule D showing sales price as $350,000 and cost basis of $300,000 and then did you take the home sale exclusion.   the IRS is not obligated to review documents submitted in lieu of official forms.   there are two rules to be eligible for the home sale exclusion. own it for any two years out of the 5 years before sale.  occupy the house for 2 years out of 5 years before sale. from your thread, you presented the IRS no evidence that you occupied it for the 2 years. 

you may want to pay to get a pro involved. wait too long and you could lose any chance to appeal. 

[Hal_Al]

Form 1099-S is usually included with your closing papers.  A separate one is not sent to you the following January.

One internet site suggests utility bills and home owners insurance as elements of proof.

[Critter-3]

The IRS must have gotten a 1099-S form which is why they questioned the missing sale and it is in the pile of paperwork you got at closing.  Once again I suggest you seek local professional assistance to properly answer the notice and get it resolved timely because there will come a point where your ONLY option will be going to tax court which costs a lot more than the consultation fee now would be.