Have you received an IRS form 1099-S and you have no idea what is and what to do with it? In this post I am going to try and explain it, and also show you how you use it. This is actually one of the most important documents as a home owner, and it is mostly over looked, and forgotten about. Most people do not know why it is so important, but it is. You need it so you can document the FULL amount of capital gains on your taxes and makes it easier when figuring out the appropriate amount you have to pay the IRS. For instance if you make a 50 thousand dollar property on the sold home, and you forget to put the whole amount on your taxes, this form will work like a safety net to keep the IRS in the loop of your money. The good news is, if you close your home with a Las Vegas realtor (which most people do) they will automatically fill this form out for you, or at least they should! But if the total money of the property is less than $600, the transaction is not reportable. The bad news is, if you don’t do your deal with a Las Vegas realtor the IRS is going to expect you do this form on your own, and it is not the easiest form to fill out. Other than actually knowing about the form, most people don’t know who is supposed to fill it out. The person responsible for the closing is the who is required to fill it out. However, if you are the buyer, you can include a clause that states that the seller is the one responsible for reporting the form to the IRS. When you are the seller, it is not necessary for you to include the clause in every transaction you do. You as the seller, it is easier for you to fill out the form because you already have a copy of your SSM and TIN or at least you should! Now you are probably wondering how you complete a 1099-s? To complete the form, you are going to need to order blank copies of IRS form 1099-S and IRS form 1096. These forms need to be printed on certain paper with certain ink, as per the guidelines from the IRS. It is possible to create these forms at home, but it is much easier to order the forms already made from the IRS directly. The forms are free and the IRS will send you them by mail, which usually take a week! HERES THE LINK ! These forms take about a minute to fill out and they walk you through the process! If you fail to fill these forms out, the IRS will fine you up to $250 per transaction! Attached below is a link that goes into more detail on why you should fill these out, and a step by step process on how to fill them out directly!
