Instructions For Form 1099-S - Proceeds From Real Estate Transactions

You are not required to indicate on Form 1099-S that

For a contingent payment transaction, include the maximum

the transferor's (seller's) financing was federally

determinable proceeds. Also see Multiple Assets Sold, earlier.

TIP

subsidized. Also, you are not required to enter the

If you are reporting a like-kind exchange of property for which

following.

no gross proceeds are reportable, enter 0 (zero) in box 2 and

Both total gross proceeds and the allocated gross proceeds

enter an “X” in the checkbox in box 4.

for a multiple transferor transaction (enter either one or the

other).

Gross proceeds do not include the value of property or

An indication that the transferor may receive property or

services received or to be received by, or on behalf of, the

services for an obligation having a stated principal amount.

transferor or separately stated cash received for personal

An indication that, in connection with a contingent payment

property, such as draperies, rugs, or a washer and dryer.

transaction, the transferor may receive gross proceeds that

Do not reduce gross proceeds by any expenses paid by the

cannot be determined with certainty under the regulations and is

transferor, such as sales commissions, deed preparation,

not included in gross proceeds.

advertising, and legal expenses. If a HUD-1 is used for a transfer

of real estate for cash and notes only, gross proceeds generally

Truncating transferor's identification number on payee

will be the contract sales price shown on that statement. If other

statements. Pursuant to Treasury Regulations section

property or services were exchanged, see the box 4 instructions,

301.6109-4, all filers of this form may truncate a transferor’s

later.

identification number (social security number (SSN), individual

taxpayer identification number (ITIN), adoption taxpayer

Contingent payment transaction. A contingent payment

identification number (ATIN), or employer identification number

transaction is one in which the receipt, by or on behalf of the

(EIN)) on payee statements. Truncation is not allowed on any

transferor, is subject to a contingency. The maximum

documents the filer files with the IRS. A filer’s identification

determinable proceeds means the greatest amount of gross

number may not be truncated on any form. See part J in the

proceeds possible if all the contingencies are satisfied. If the

2016 General Instructions for Certain Information Returns.

maximum amount of gross proceeds cannot be determined with

certainty, the maximum determinable proceeds are the greatest

Filer's Name, Address, and Telephone Number

amount that can be determined with certainty.

Box

Box 3. Address or Legal Description (Including

Enter the name, address, and telephone number of the person

City, State, and ZIP Code)

who is filing Form 1099-S. The name and address must be the

same as the filer information reported on Form 1096.

Enter the address of the property, including the city, state, and

ZIP code. If the address does not sufficiently identify the

Transferor's Name and Address Box

property, also enter a legal description, such as section, lot, and

block. For timber royalties, enter “Timber royalties.” For

Enter the name and address of the seller or other transferor of

lump-sum timber payments, enter “Lump-sum timber payment.”

the real estate. If spouses are joint sellers, it is only necessary to

enter one name and the TIN for that person on the form.

Box 4. Check Here if the Transferor Received or

Account Number

Will Receive Property or Services as Part of the

The account number is required if you have multiple accounts for

Consideration

a recipient for whom you are filing more than one Form 1099-S.

If the transferor received or will receive property (other than cash

Additionally, the IRS encourages you to designate an account

and consideration treated as cash in computing gross proceeds)

number for all Forms 1099-S that you file. See part L in the 2016

or services as part of the consideration for the property, enter an

General Instructions for Certain Information Returns.

“X” in the checkbox in box 4.

Box 1. Date of Closing

Box 5. Buyer's Part of Real Estate Tax

Enter the closing date. On a HUD-1, the closing date is the

For a real estate transaction involving a residence, enter the real

settlement date. If a HUD-1 is not used, the closing date is the

estate tax paid in advance that is allocable to the buyer. You do

earlier of the date title transfers or the date the economic

not have to report an amount as allocable to the buyer for real

burdens and benefits of ownership shift to the transferee.

estate taxes paid in arrears. You may use the appropriate

information included on the HUD-1, or comparable form,

Box 2. Gross Proceeds

provided at closing. For example, a residence is sold in a county

Enter the gross proceeds from the sale or exchange of real

where the real estate tax is paid annually in advance. The seller

estate. Gross proceeds means any cash received or to be

paid real estate taxes of $1,200 for the year in which the sale

received for the real property by or on behalf of the transferor,

took place. The sale occurred at the end of the 9th month of the

including the stated principal amount of a note payable to or for

real estate tax year. Therefore, $300 of the tax paid in advance

the benefit of the transferor and including a note or mortgage

is allocated to the buyer, by reference to the amount of real

paid off at settlement. If the transferee assumes a liability of the

estate tax shown on the HUD-1 as paid by the seller in advance,

transferor or takes the property subject to a liability, such liability

and is reported in box 5. See Notice 93-4, 1993-1 C.B. 295.

is treated as cash and is includible as part of gross proceeds.

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Instructions for Form 1099-S (2016)

Instructions For Form 1099-S - Proceeds From Real Estate Transactions - 2016 Page 4

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