The market value was was around $56,611 according to the property appraiser office at the time. If I have to report the full amount of $75,000 there was a gain....

Update: I asked the closing company about it and they were able to send me a corrected 1099-S.

I'm not sure what you mean by allocated. The closing company did ask us how the proceeds were suppose to be split. They split the proceeds in half and sent it t...