If client bought there home (primary residence) for 140,000.00 sold it 5yrs later 385,000.00 they are at 245,000.00 as gain. This is not including things to add to there cost basis. Do I need to enter anything? If I do where do I enter it at?
Since the sale was for 385K a 1099S was issued and floating around out there somewhere, youd report this on the HomeSale worksheet....they should qualify for the IRC121 250k exclusion and end up with nothing taxable.
You don't know how many times that a client has told me that they didn't receive a 1099S. But it's also amazing how many times when they give me their paperwork for the sale, how quickly I can find one.
Assuming "there" means "their" and you are working on a joint return, it's quite possible that no 1099-S was issued because the sale was for less than $500K and the taxpayers certified that the home had been their primary residence for two of the last five years. it's also quite possible that their closing documents included a copy of the certification form they signed. So the place to start is by asking (or looking) for that, to avoid needless paperwork. Unless you really want to run up the bill.
I have asked the client about the 1099 S and She has told me she did not get one. How would I find one if it is out there. I thank everyone so much for the help this is the fist house sale i have ever done on taxes. So I am a fish floating in water. I want to make sure I am going over everything. She is single also. The closing statement is confusing compared to the sale of home work sheet.
In the amount of time you spent asking these questions, you could have easily completed the sale worksheet ( hit f6 key and type sale) form only takes a couple of minutes after you have done a few, (not enough to change my fee). I do it on every sale as even 5 minutes per return at a maximum 10 returns that apply each tax season is less than one time having to respond to a notice,
Different keystrokes for different folks. I don't assume there is not a little man at IRS with a green eyeshade looking at returns and saying, "these folks didn't get a 1099-S but they still think they have to claim the exclusion, maybe we should look at what that's all about." I do assume that my clients look at returns and expect me to explain where the numbers came from. So I feel some obligation to ask them about basis and improvements and all that. For those who don't waste their time talking to clients before and after a return is done, the shortcut probably works well.
