Sale of all things including house at auction

[Super Mom]

I have a senior adult who became a widow and sold everything including the house at auction. I have already informed her that the house is non-taxable because she lived there for many years. However, all of the other items may have had a gain? She probably has no idea what her husband paid for some of it, some was probably sold at a loss. I've never had a situation like this, I don't know whether to tell her to expect a 1099 or what. She probably wouldn't file without this, any advice?

[gboykin]

What else was sold? Was it personal property and effects - ie, furniture, fixtures, etc., or was it additional real estate, collections, business property? If it is personal items, there should not be a taxable event. I think we need more information as to the type of items that were sold along with the house.

[Super Mom]

Personal Items

It was personal items such as furniture and fixtures, tools, etc...I think a truck may have been in that too, but no additional property or anything.

[abctax]

Wouldn't

she get stepped up basis (or at least for his half)? Are we talking about some antiques - otherwise I would think it's unlikely there is much of a gain.
I've never dealt with an auction house; perhaps you can ask if they issue F 1099's. I doubt it tho, as the sale of items (except for the house) shouldn't generate a F 1099 - they are generally issued for services.
She may get a F 1099-S (I think that's it) for the sale of the house, but if the gain is less than the exclusion amount she isn't required to report it.

[DMICPA]

Sale of personal property

The home may not be a taxable event due to the section 121 exclusion but the other thing that I am thinking is that in many cases, there is a step-up in basis at the passing of the husband. That said, there would most likely not be a gain if the items were sold near the time of His passing. If the items were of a personal nature, there would be no loss recognized.

In the event that a 1099 is received, the cost would be equal to the proceeds received resulting a no gain or loss.

[abctax]

Actually..

What else was sold? Was it personal property and effects - ie, furniture, fixtures, etc., or was it additional real estate, collections, business property? If it is personal items, there should not be a taxable event. I think we need more information as to the type of items that were sold along with the house.

Personal items (say antiques) that are sold at a gain are reportable/losses aren't deductible.
Can't say I've ever had a client fess up on such a situation tho :-)

[gboykin]

I agree abc tax, but I wasn't referring to antiques. I was referring to normal furnishings that will depreciate over time, not appreciate. That's why I indicated that more information was needed to form any opinions.

[abctax]

Just wanted to clarify, as the original OP did indicate a possible gain on personal items.
We do need more specifics to completely answer the question.

[Super Mom]

No Antiques

There were no antiques per say, just personal items---that being said these are elderly people and a lifetime of accumulations so some items may have been "antique"

[abctax]

Then it seems unlikely that anything would have sold for more than they paid (or the stepped up basis amount) for the items, except the house. Still curious why your OP referenced a gain on some of the things....did you just mean the house?

[Super Mom]

Gain

The reason my original post mentioned a gain is because I didn't know if there would be some gain on the personal items sold because the auctioneer told the lady to keep her receipts because she would have to report it to the IRS. Sorry!

[abctax]

hmmmmmm

....auctioneer giving tax advice....what next !?!? Good thing she has you.

[DMICPA]

Answers to everything

Not to digress, but I have found that to get an authoritive answer on any subject, all you have to do is visit a small town barber shop where world events are discussed and solved on a daily basis.

Not always right but never in doubt.

[gboykin]

Realtors are also very knowledgeable in the field of taxation.