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sale of inherited farm property

I am using Turbo Tax premier desktop for 2023.  I have received a 1099-S for the sale of the farm property I inherited upon my mother's death.  I have entered the entered this under Investment Income - Stocks, Crypto, MF, Bonds, Other. I have downloaded from my brokerage my mutual fund transactions. I then chose to add more sales and clicked the box Other for (land, second homes, personal items) 1099-S.

I then entered the Title service that issued the 1099-S that handled the sale transaction. Next screen had fields for; Type of investment sold - chose:  Land (other investment purposes). next, how did I receive this investment - chose: I inherited it. next - entered a description, next entered the date sold, proceeds as shown on 1099-S and fair market value that I received from a certified appraiser of the property at the time of my mother's death.

The clicked continue and the screen asked for if these situations apply, checked sale expenses not reported on the form and entered the amount paid to the Title Co for their work.

Now my issue is that on form 8949 (Copy) Part II which only contains my inherited property transaction, the box for the transaction is checked [F] or should it be [E] ?  Is a 1099-S considered a Form 1099-B. This ends up with which line on Schedule D will the amounts show up, line 9 or 10.  There was on basis reported to the IRS. I am confused?

 

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1 Reply
DavidD66
Expert Alumni

sale of inherited farm property

Box F is correct.  The transaction was not reported to you on a 1099-B.  A 1099-S is not considered a 1099-B.  The transaction should flow to Line 10 of Schedule D.   As for what you indicated for "Type of investment sold", you chose Land (other investment purposes).  That would be the correct choice if you used the land for business (money making) purposes, or held it as an investment.  You didn't indicate when you inherited the property, but if you inherited it in 2023 and then sold it in 2023 it would be Land (personal use).  Regardless of when you inherited the land, if you didn't use it for business purposes or hold long term as an investment it would be personal property, which means you cannot realize a loss on the sale if you had one.  If you had a gain on the sale it is a moot point, as gains are reported for personal property.   

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