I was dreading having to ask for help on this... I just can't wrap my mind around what makes sense with this.
Client (& sibling) inherited a home. Neither lived there nor rented it out. They spent a year trying to sell it, as there were issues with it not being 'financeable'. It finally sold. My client was issued a 1099-S for 1/2 of the sale price, which is WAY more than the check that was cut after expenses were paid. I was provided with the settlement statement & divided all expenses in half. I am 2nd guessing what can be counted as expenses of sale. There are the regular commissions, attorney, bank fees- (the house was nearly foreclosed on prior to sale). So, what of the existing mortgage that was paid off? Is this an expense or not? It was paid off out of the sale proceeds.
FMV on date of death (home & land)$172000 (by tax rolls)
Sale price $195000
Existing mortgage payoff $125000
2nd mortgage payoff $8000
Other misc expenses (attorney, RE agent, Title Fees, etc) $32000
State taxes $8000
These are round #'s- but it gives the just of what I'm looking at. And these are the totals (not divided by half)
B/T/W the 1099s shows $10000 (1/2 of sales price), and client got a check for less than $10,000.
Sooooo, I made it difficult- but does she get to use the mortgage as part of expenses? And what about amount remitted to state?
THANK YOU!!!
Client (& sibling) inherited a home. Neither lived there nor rented it out. They spent a year trying to sell it, as there were issues with it not being 'financeable'. It finally sold. My client was issued a 1099-S for 1/2 of the sale price, which is WAY more than the check that was cut after expenses were paid. I was provided with the settlement statement & divided all expenses in half. I am 2nd guessing what can be counted as expenses of sale. There are the regular commissions, attorney, bank fees- (the house was nearly foreclosed on prior to sale). So, what of the existing mortgage that was paid off? Is this an expense or not? It was paid off out of the sale proceeds.
FMV on date of death (home & land)$172000 (by tax rolls)
Sale price $195000
Existing mortgage payoff $125000
2nd mortgage payoff $8000
Other misc expenses (attorney, RE agent, Title Fees, etc) $32000
State taxes $8000
These are round #'s- but it gives the just of what I'm looking at. And these are the totals (not divided by half)
B/T/W the 1099s shows $10000 (1/2 of sales price), and client got a check for less than $10,000.
Sooooo, I made it difficult- but does she get to use the mortgage as part of expenses? And what about amount remitted to state?
THANK YOU!!!
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