! sold a house and received form 1098-S with $2,051 in box 6.

[agomstyn]

! sold a house for 500,000. I received form 1098-S with $2,051 in box 6. Do I add it to the sale price when I enter sale into TurboTax or just enter original 500,000 from box 2?

[Bsch4477]

Box 6. Shows certain real estate tax on a residence charged to the buyer at

settlement. If you have already paid the real estate tax for the period that

includes the sale date, subtract the amount in box 6 from the amount already

paid to determine your deductible real estate tax. But if you have already

deducted the real estate tax in a prior year, generally report this amount as

income on the “Other income” line of Schedule 1 (Form 1040). For more

information, see Pub. 523, Pub. 525, and Pub. 530

[agomstyn]

Clarification:

1. Turbotax asks me to enter total sale price.

2. I paid 3rd quarter real taxes as required on August 1st

3. When I press "?" button it seems to indicate that real estate tax paid by the buyer to the seller (Box 6, Form 1098-S) should be added to the sale price, therefore I should enter $502,051 into turbotax, instead of $500,000. But I'm not sure if I understand it correctly. 

4. Do I enter $502,051, instead of $500,000, or do I enter $500,000?

Thank you in advance for clarification.

BTW, Turbotax should create 1098-S entry worksheet, just like it does for 1099 forms.

[KrisD15]

No, 

Enter 500,000.

In your situation, the taxes the Buyer paid you (because you had paid the property taxes early) does NOT get added to the sales proceeds. 

The "On Demand (?)" box is saying that if a person sells a house with back taxes due, and the Buyer pays those back taxes, that would get added to the sales price. In other words, if I did not pay the last three years of property tax totaling 5,000, and the Buyer pays me 100,000 cash and also pays those 5,000 taxes off for me when he buys my house, that would be the same as if the buyer paid me 105,000. That would be the only time the taxes paid would be added to the sale price. 

In your situation, you paid taxes in August, ahead, so when you closed, you had paid 2,051 more in property tax than what is attributed to the time you were living in the house. Rather than trying to get the state to refund you the "extra" tax you pre-paid, they just have the new owner pay you, (since you already paid the state in August)

As mentioned earlier, if you claim property tax paid as an Itemized deduction, don't include the 2,051 that the Buyer gave you.  In other words, if you paid 3,000 each of three questers, but the buyer reimbursed you for 2,051, you can only claim 6,949 in Property Taxes paid on that house. (the 9,000 you sent in to the state less the 2,051 the buyer gave you) 

The property tax you can claim as a deduction has nothing to do with reporting the sale of the house. 

The 2,051 does not affect the sale price. You needn't enter it nor adjust for it in the "Sale of Home" section.