Sold land as a down payment when purchasing home in the same transaction - do I need to report that sale?

[tp320580]

In 2023, I purchased land (and paid in full) in the hopes of building a new home, but ended up sitting on that land. This year, I ended up purchasing a newly built home, but as part of that purchase transaction, the same builder I bought the home from purchased my land as part of the sales agreement. 

I used the entire value of the land as a full down payment towards my mortgage - because of this, I never received cash for the land, as it was written into the purchase agreement as a down payment towards the house.

Do I still need to report the sale of the land, even though it was one entire sales/purchase transaction as a down-payment towards my mortgage (and never actually received cash for the land) ?

[Mike9241]

yes, you need to report the land sale. 

this is no different than selling the land and using the cash to pay for the house.

there is nothing in the tax code that would allow you to skip reporting the sale.