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Old 02-20-2014, 04:40 PM
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Question on 1099S

Hello,

Was hoping to get some feedback on my concern. I sold a real-estate property last March amounting $160K. This property had three names on the deed plus the lender. During closing, $130K went to pay off the rest of the loan which the check was sent to the lender. The remaining $30K was split in to the three checks and issued to names (A, B, C) for the amount of $14K, $13K, and $3K respectively.

This week I received the 1099S from the Attorney's office with the following amount for A, B, C - $80K, $64K, and $16K which happens to total $160K (the value of the house when it was sold back in March). I'm a little concern since if A, B, and C file their taxes respectively, they will be charged in taxes for the amount indicated in the 1099S which is obviously WAY more than what they received after closing. Shouldn't the 1099S reflect the amount issued on to the check on went to each fo the individuals?

Can anyone enlighten me as to who this would affect the way WE (A, B, C) file our taxes or do I need to contact the Attorney's accounting department to have them correct any mistakes? BTW, A & B were the primary owners of the real-estate, C was just a co-signer.

Any feedback is appreciated.



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Old 02-21-2014, 03:14 AM
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Originally Posted by fllipphinoi View Post
Hello,

Was hoping to get some feedback on my concern. I sold a real-estate property last March amounting $160K. This property had three names on the deed plus the lender. During closing, $130K went to pay off the rest of the loan which the check was sent to the lender. The remaining $30K was split in to the three checks and issued to names (A, B, C) for the amount of $14K, $13K, and $3K respectively.

This week I received the 1099S from the Attorney's office with the following amount for A, B, C - $80K, $64K, and $16K which happens to total $160K (the value of the house when it was sold back in March). I'm a little concern since if A, B, and C file their taxes respectively, they will be charged in taxes for the amount indicated in the 1099S which is obviously WAY more than what they received after closing.


#2;Shouldn't the 1099S reflect the amount issued on to the check on went to each fo the individuals?

#3;Can anyone enlighten me as to who this would affect the way WE (A, B, C) file our taxes or do I need to contact the Attorney's accounting department to have them correct any mistakes? BTW, A & B were the primary owners of the real-estate, C was just a co-signer.

Any feedback is appreciated.
Was hoping to get some feedback on my concern. I sold a real-estate property last March amounting $160K. This property had three names on the deed plus the lender. During closing, $130K went to pay off the rest of the loan which the check was sent to the lender. The remaining $30K was split in to the three checks and issued to names (A, B, C) for the amount of $14K, $13K, and $3K respectively.

#1;no;1099s is just for informational purposes only.each of the A,B,C parties needs to determine the adjusted basis of the r/e property to calculate gain or loss on the sale; you have a cost basis associated with the acquisition. If you purchase the property for $190K, your cost basis will be $190K;it is clear that additions or capital improvements increase the basis of te r/e property. The adjusted basis is computed by taking into account all increases and decreases in the property's original basis. Determining the adjusted basis of r/e pty is important because you will need it to calculate your gain or loss on sale, which in turn affects your taxable income.



#2; the Attorney's office is the party responsible for filing form 1099-S with the IRS and sending a copy to you,the seller. you will use the information from the form 1099-S along with the settlement statement from the sale of your real estate to report a capital gain or loss. You will need to complete Sch D of 1040 /Form 8949, which will then transfer to Form 1040, line 13. It shows the gross proceeds from a real estate pty transaction, generally the sales price. Gross proceeds include cash and notes payable to you, notes assumed by the transferee (buyer), and any notes paid off at settlement. Box 2 does not include the value of other property or services you received or will receive.


#3;A, B and the co-signer would sign the promissory note in favor of the lender as well as other loan agreements The co-signer should be entitled to any monies they contributed to the original sale, plus appreciation.i guess A r/e lawyer can help you and your co-signer draw up an agreement that specifies, like what happens if the pty isdisposed of. In general,A co-signer on a mortgage note means nothing if it's recorded in just two persons,A and B names



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