What Is Form 1099-A and How To Enter It
The issuer of the Form 1099-A is required to mail or transfer the 1099-A by January 31 following the tax year.
Include Form 1099-A with your tax return as the result of in full or partial satisfaction of the debt. For example, if a mortgage lender foreclosed on a property and canceled all or some of the mortgage, or the lender sold property in a short sale. Each lender would issue you a Form 1099-A for mortgage(s) on the foreclosed property.
In case of a home foreclosure the reported sales price listed on Form 1040. If you had a capital gain - what is a capital gain? A simple way to calculate capital gains is to subtract the home sales price from the home purchase price or base cost. As the result of Form 1099-A, you would report this on Schedule D as outlined below - eFile will help generate this form for you.
Generally, you are only required to report capital gain on a foreclosed property as long as the following applied to you:
- You lived or resided in your home and used it as your primary residence for at least two of the previous five years
- You may qualify to exclude up to $250,000 - filing as single - of the capital gain from your income, or up to $500,000 of capital gain - as married filing joint. Thus, you would only report values above these amounts.
2. Form 1099-A
Sample
Sample Form 1099-A - Acquisition or Abandonment of Secured Property.
3. Where Do I
Enter Data?
You enter Box 2, 4, and Box 5 of 1099-A on Schedule D. Use the value in Box 2 or 4 as the value of the property; if Box 5 is checked, you may be responsible for the repayment of the debt. As a result, Schedule D will be reported on Line 7 for Form 1040.
To enter 1099-A into your eFile account, start in the Income section. Your 1099-A will be entered as a sale of a home or other property under the Investments section. Enter the date the property was acquired, the date it was sold, and the sales price. Review the boxes in section 4 below to determine which amount to use from your 1099-A.
See a detailed description of each Box of form 1099-A below.
4. Box Descriptions
Box 1099-A
Box 2 of Form 1099-A: Outstanding loan balance.
Box 4 of Form 1099-A: Fair Market Value - use this if you are not liable for the remaining debt.
Box 5 of your Form 1099-A: If is checked, then enter the outstanding loan balance as your sales price as the lender could pursue you to collect any outstanding balance not recovered by selling the property.
See detailed instructions for Form 1099-A.
5. Form 1099-C
You might also receive a Form 1099-C in addition to Form 1099-A for a foreclosed property if it is considered canceled debt.
6. How to Add, Delete
a Form or Page
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