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We have 1099A's and 1099C's . Foreclosure. How do we report this correctly? Box 5 on the 1099C's is not checked. We don't have any forms for sale of the house.

 
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3 Replies
LinaJ2018
Intuit Alumni

We have 1099A's and 1099C's . Foreclosure. How do we report this correctly? Box 5 on the 1099C's is not checked. We don't have any forms for sale of the house.

If you received the forms for your main home, for Form 1099-A, treat it as a sale of home by following these steps:

1.  After sign into your account, select Take me to my return 

2.  In the Search box , at right upper corner, type in sale of home then Enter

3.  Select Jump to sale of home

4.  Program will take you directly to screen, Sale of Your Main Home screen, select Yes. 

     Then follow the prompts.


If there is a gain generated from the sale, you can exclude up to $250,000 of gain ($500,000 if you're filing jointly) if:

·         You owned the home; and

·         It was your main home for two years or more of the five year period ending on the sale date; and

·         You did not exclude gain from the sale of another home during the two year period ending on the sale date.


For Form 1099-C, if it is a cancellation of debt on your main home, you can use TurboTax to file, see instructions below.  If it is for other types of cancellation of debt other than your main home, for example, like credit card, student loan etc, you might want to consult a tax professional.   Please follow instructions from below:

  1. Open (continue) your return.
  2. In the TurboTax program, search for 1099-C or 1099C (lower-case works also) and then click the "Jump to" link in the search results.
  3. Select the type of cancelled debt (main home or other) and then click Continue.
  4. Follow the onscreen instructions to enter information from your 1099-C.

Note: In other uncommon situation, refer to IRS publications 544 and 4681 before proceeding, or consult with a professional tax preparer.

We have 1099A's and 1099C's . Foreclosure. How do we report this correctly? Box 5 on the 1099C's is not checked. We don't have any forms for sale of the house.

I received a 1099-C cancellation of a Debt.  I was needed to know how to take care of this.

VictoriaD75
Employee Tax Expert

We have 1099A's and 1099C's . Foreclosure. How do we report this correctly? Box 5 on the 1099C's is not checked. We don't have any forms for sale of the house.

To enter a 1099-C, follow these steps:

  • Under the Federal menu, choose Wages & Income
  • Expand the menu for Less Common Income
  • Click Start/Revisit next to Miscellaneous Income, 1099-A, 1099-C
  • Click Start/Revisit next to Cancellation of debt (Form 1099-C) or the abandonment and/or acquisition of secured property (Form 1099-A)
  • Enter the information on the screens that follow

If you do not qualify for an exclusion or exception, your canceled debt is taxable and must be reported on the “other income” line of your tax return or on Schedule C if it relates to your sole proprietorship business. If you qualify for an exception or exclusion, you don’t report your canceled debt on your tax return. However, when using an exception, you may need to file a Form 982 to reduce your tax basis, or cost, in the underlying property if the debt relates to your insolvency or bankruptcy. This reduction in basis can increase the taxable gain that you'll recognize when you sell the property.

 

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