What's the best way to complete the 8949 to accompany Form 1041 (Estate) when I have not received a 1099-S? I filled out a "1099 Reporting Form" when I signed the closing documents, which noted only the Gross Sales Price. The Title Company keeps telling me, "You completed the 1099-S" by filling out this form. They told me they have to file the 1099-S electronically with the IRS by March 31, so I contacted them again to ask them to provide me with an actual 1099-S now to confirm what information they reported. They will not respond.
I suspect they filed the 1099-S showing the Gross Sales Proceeds, but I can't confirm it b/c they won't send me a copy.
So, my questions about the 8949:
1) Do I put the Gross Sales Price in column (d), the FMV DOD value of the house in column (e), Code E in Column (f), and Selling Costs in column (g)?
or
2) Put the Gross Sales Price in column (d), put the FMV value of the house plus Selling Costs as the Basis in column (e), and leave columns (f) and (g) blank?
or
3) Put the Gross Sales Price minus Selling Costs in column (d), and FMV value of the house in column (e), and leave columns 9f) and (g) blank?
The other BIG question:
What other costs should/could I add to the Basis?
Selling costs like Inspection fees? Planting a tree (required by HOA)? Major landscaping clean up?
Maintenance / Preservation of Property costs like Insurance, HOA fees, and utilities? (I've seen answers both ways, Yes and No for these costs).
Thank you!
Net proceeds in (d) since you didn't receive a 1099-S and DOD FMV in (e).
Thanks, Mike 9241 - what about the rest of it (other questions)?
Thanks, tagteam. I'm getting 2 different answers already (see above). This is why I'm a bit confused, it seems like people do this differently. Also, what about the rest of the questions? Thank you.
Weirdly, when I do use the Gross Sales Price in column (d), the NJ 1041 Form then subtracts the selling costs and uses Net Proceeds there. The inconsistencies are really confusing.
You should be able to add expenses to preserve estate property to basis but watch out for Section 1.67-4:
when in receipt of a 1099-S ( or not),
file exactly as you would without a 1099-S.
Do not omit the sale based on ineligible capital gains or any other excuse.
Follow the instructions below that apply to your transaction(s).
You didn't receive a Form 1099-B or 1099-S (or substitute statement).
If you didn't receive a Form 1099-B or 1099-S (or substitute statement) for a transaction, enter in column (d) the net proceeds. The net proceeds equal the gross proceeds minus any selling expenses (such as broker’s fees, commissions, and state and local transfer taxes). If you sold a call option and it was exercised, you adjust the sales price of the property sold under the option for any option premiums (as instructed under Gain or Loss From Options in the Instructions for Schedule D (Form 1040)).
You received a Form 1099-B or 1099-S (or substitute statement).
If you received a Form 1099-B or 1099-S (or substitute statement) for a transaction, enter in column (d) the proceeds shown on the form or statement you received. If there are any selling expenses or option premiums that aren't reflected on the form or statement you received (by an adjustment to either the proceeds or basis shown), enter “E” in column (f) and the necessary adjustment in column (g).
See https://www.irs.gov/instructions/i8949#en_US_2022_publink59421zd0e1813
Thank you, tagteam. I have read that regulation about 20x and I basically concluded I should not add anything to the basis b/c all the expenses were ones that would be incurred by an individual owner, although the house was unoccupied - nothing was "only" incurred b/c the owner is the Estate. The costs were all normal ownership costs (HOA fees, insurance,utilities) to preserve the house for sale, or costs in preparation of the sale (inspections, replacing a tree, landscaping for sale) that an individual owner would also incur.
fanfare, I don't understand your response. I am not omitting the sale, I'm simply asking how to report it properly.
Thank you tagteam, I did read those instructions re the 1099-S, but it is useful to see them again. I think the problem is that the Title Company probably did file it so the IRS has a 1099-S but I do not., and the IRS may be looking for that Gross Sales Price. Maybe I should attach a Statement clarifying that I did not receive a 1099-S? Or will that just be more confusing and I should just go with Net Proceeds in column (d).
I meant just go with Net Proceeds in column (d) and Not attach a Statement explaining there was no 1099-S provided to me.
So, tagteam, when I go into TurboTax Business, it does NOT ask whether there is or is not a 1099-S, and it instructs me to enter the Selling Price WITHOUT subtracting the selling costs. It then completes the 8949 as though there were a 1099-S, using Gross Proceeds in column (d), FMV Basis in column (e), Code E in column (f), and (Selling Costs) in column (g).
Should I include a Statement to the IRS explaining that there is NO 1099-S? Even though TurboTax completes the 8949 as though there is one? Or should I just submit the TurboTax return with no comment?
This is just me and my sole opinion, but if it were me, I would simply submit the return without any comment or explanation.
If the IRS wants further information, they will send a letter to which you can respond with more details (and you may never get anything from the IRS).
Here's one final follow up question, tagteam. The sale of the house took a while b/c the Executrix is disabled, then there were buyer delays, but the house sold 2 years and 1 week after Date of Death, all Estate assets transferred a few weeks later. and the Estate closed. This is a First and Final 1041. Question 8 of Other Information reads, "If the decedent's estate has been open for more than 2 years, attach an explanation for the delay in closing the estate." If the Estate is closed, does this question even apply? If so, I will attach a Statement (then I have to paper file). If not, I will e-file. What would you do?
I'd probably just e-file and see what happens since it's only been 1 week past the two-year mark.
You are the best, tagteam, thanks for the quick reply! I think I'm good to go now. I really appreciate the help!
So, tagteam, I was ready to e-file, got th Executor to sign the 8453 FE form (which you can attach through TurboTax), but now TurboTax has checked the box for Question 8 of Other Information and will not allow me to uncheck it (re the Estate has been open for more than 2 years). It must "read the dates" once it gets ready to File, and now I can't uncheck it. It's probably b/c I'm using Calendar Year for 2023, and TurboTax reads the DOD of 8/31/2021 and "knows" it's a more than 2 year period.
So I guess we have to paper file, ironically, b/c TurboTax won't allow me to attach that explanatory statement for Question 8 of Other Information. Unless you know a workaround to uncheck the box?
In that event, you're better off printing and mailing the return with an explanatory statement.
You could do an override but that would likely prevent you from e-filing, regardless.