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Lev
Lev, Tax Advisor
Category: Tax
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Experience:  Taxes, Immigration, Labor Relations
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I think I may have to file an amendment to my 2011 return that

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I think I may have to file an amendment to my 2011 return that I just filed. My grandmother passed away last year, and they sold her home and split the proceeds between the grandchildren. As I was filing my completed returns in my file cabinet, I realize that there was a substitute form 1099-s that went along with that sale. Do I need to amend? It was split between 17 of us...about $5000 total.
Submitted: 2 years ago.
Category: Tax
Expert:  Lev replied 2 years ago.
Hi and welcome to Just Answer!
If the form 1099S was issued in your name - the IRS expects you to report the sale transaction.
However because the property was inherited - you have stepped up basis equal to the fair market value of the property at the time the decedent passed away.
That means your gain = (selling price) - (basis) will be zero and you do not have any tax liability realized from that sale - still need to be reported on your tax return.
To amend your tax return - use the form 1040X - www.irs.gov/pub/irs-pdf/f1040x.pdf
You should attach following forms:
The sale transaction is reported on form 8949 - Part II - http://www.irs.gov/pub/irs-dft/f8949--dft.pdf - if the property was held more than a year - box "C" in the header should be checked.
Then - amounts will be transfered to schedule D - http://www.irs.gov/pub/irs-pdf/f1040sd.pdf
Part II, line 10 - and you should have the taxable gain in column (h) - which is zero in your situation.
Let me know if you need any help.
Customer: replied 2 years ago.
Would I put it in Section II even though that says for assets held for over a year, even though I didn't hold it for that long??? Or does the "held for" part apply because my grandma had it for longer than that?
Expert:  Lev replied 2 years ago.
Inherited assets are always treated as held more than a year regardless - so yes - it is reported as long term capital gain - while there is no actual gain.
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 22844
Experience: Taxes, Immigration, Labor Relations
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