Form 1099-S; Proceeds From Real Estate Transactions

Page in progress. Last updated 4/2/17

Caution: This is not tax advise. This page is brief overview of what Form 1099-S , Proceeds From Real Estate Transactions is, who may receive a Form 1099-S and how to report this within the program.  

Form 1099-S Proceeds From Real Estate Transactions is used to report the sale or exchange of real estate and is required to be reported on the tax return the same year it is received.

Do not report the sale of your main home on your tax return unless:

  • You have a gain and do not qualify to exclude all of it,
  • You have a gain and choose not to exclude it, or
  • You have a loss and received a Form 1099-S.

Form 1099-S from Sale of Personal Residence: 

This section is a brief overview of the requirements for taking the exclusion for up to $250,000 (up to $500,000 Married Filing Jointly). 
Refer to Publication 523 for the complete eligibility requirements, limitations on the exclusion amount, and exceptions to the two-year rule.

Section 121 Exclusion for up to $250,000 (up to $500,000 Married Filing Jointly):

Ownership & Use Test Eligibility Requirements:

Generally, you qualify to take the full exclusion only when all (3) of the following requirements have been met.
During the 5-year period ending on the date of the sale, you must have:     

    1) Owned the home for at least two years (Ownership Test).

    2) Lived in the home as your main home for at least two years (Use Test).

    3) You didn’t claim any exclusion for the sale of a home that occurred during a 2-year period ending on the date of the sale of the home, the gain from which you
        now want to exclude.

The exclusion only applies when there is a Gain from the sale of your main home. 

To Add Schedule D Capital Gains & Losses Listing Page to the return:

Add "Schedule D Listing Page" to report your Gain (or Loss when there is a Form 1099-S). 
Form 8949 entries are within the Schedule D, and will automatically be included when information is entered requiring it 

- Select "Income" from the list. 

Then click on "Add Income Form".


Select "Schedule D Capital Gains & Losses Listing Page". 
Note: Schedule D Capital Gains & Losses Listing Page can be added  from within the "Schedule D Capital Gains & Losses"  page as well.

Select "Add New".

Schedule D Capital Gains & Losses Listing Page:

Before entering any information, click the "Click here to Show Advanced Entries" link when adjustments to the income will be to be entered pertaining to qualified expenses (closing costs, real estate agent commissions, etc). 
When either "Show Advanced Entries" or "Hide Advanced Entries" is selected, any information entered will be lost.

This is located about half-way down page. 

Description of Property: 
Generally, this will be the address of home that was sold.

Transaction will not be reported on Form 1099-B:
This box must be checked, failure to will result in a error preventing the page from being Saved.

Information from Form 1099-B (leave blank if no Form 1099-B):
Do not enter anything in this section.

Actual amounts if different from Form 1099-B or no Form 1099-B:

Asset Purchased in parts:
The holding period does not apply to Sale of Residence. 
Select "Not Purchased in Parts".

Date Acquired:
This is required if you are taking the exclusion.  

Cost or Other Basis:
This is generally the purchase amount plus any qualifying adjustments.

Date Sold:
Enter the date sold.

Sales Price:
This will be the amount on Form 1099-S, or if no Form 1099-S this is the amount the residence sold for.

Check All That Apply:

This transaction is for the sale of a main home:
Check this box when qualify for the $250,000 ($500,000 MFJ) exclusion.

Advanced Entries:
Note: This is not a complete list of the Advanced Entries. Only those that are in regards to sales of residence.

Amount not reflected for selling expenses or options:
Enter here any qualified selling expenses that were not reflected on the Form 1099-S. 

Selling Expenses are entered as a negative amount (ex. -500).

For information on what type of expenses qualify see IRS Publication 523.