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Was the home jointly owned by your mother & father? What does it say on the 1099-C?
Whose social security number is XXXXX the 1099?
The home was in my father's name only. The 1099 is listed to "estate of J.M.D.
Interesting, but you still had to turn the proceeds over to the state of Wisconsin.
Was it transferred from joint ownership within 5 years from when your mother went into the nursing home?
Is your father's social security number on the 1099-C?
Yes. Mom entered the nursing home in 2009. When she went into the nursing home, Dept. of Social Services had dad sign over the house to the state of Wisconsin so that he could live in the home for the rest of his life but at the time of his death, the house was to be sold and proceeds then would go to the state of Wisconsin. I can't say for sure if Dad's ss# XXXXX XXXXX the 1099C as I don't have it right in front of me, but I don't believe so.
Mom's name was taken off the house when Dad signed over the house to the state of WIsconsin. DSS told him that was the way it had to be done.
If your father transferred the house to the state & retained a life estate in the house (which means he could live in it as long as he was alive) then he didn't own the house when it was sold, in fact he couldn't have since he wasn't alive.
His estate didn't own the house as it was transferred while he was alive.
Your mother didn't own the house, your father must have had her Power of Attorney or she would have had to sign the deed also (if the house was jointly held).
So I don't think the 1099-C is really correct, but in any event, I wouldn't worry about filing any tax returns for anyone or the estate, because nobody you are responsible for sold the house. If the IRS has a problem, they can go visit the State of Wisconsin.
It wouldn't matter anyway as since the debt was on their principal residence, there is an exception to having to pay any tax for debt forgiveness related to their principal residence.
I'm surprised that the state got the proceeds when there was an outstanding mortgage on the property.
The title of the house was "legally" still in my father's name. At the time of his death, (and I literally mean within 48 hours of his death) DSS was calling me stating I had to put the house up for sale and sell it ASAP. As for my mom signing anything, since she is in the late stages of Alzheimer's, a physician had to sign a release stating that she was incapible of making her own decisions, and unable to sign for herself. She marked with an "x" and everything was witnessed. I am my mother's power of attorney. The house in question had no mortgage.
If the house had no mortgage, what is the 1099-C related to?
So your statement that the DSS had your father sign over the title of the house to the state of Wisconsin when your mother went into the nursing home wasn't accurate?
What you received was not a 1099-C - debt forgiveness, it was a 1099-S reporting the sale proceeds?
That's a giant difference.
So you are the one that signed the deed on behalf of the estate?
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Sorry I had to leave. I wanted to get the paperwork in front of me so I knew exactly what I had. It is indeed a 1099-S. I apologize. This is all new to me. It is listed to the estate of j.m.d. and yes I did have to sign off on the deed at the time of the sale.
When Mom went into the nursing home Dad signed paperwork which stated that he could live in the house as long as he was alive, but in the event that he sold the house, or at the time of his death, the proceeds from the sale of the house went to the state of Wisconsin. Neither myself or anyone else (my mother) received any financial gain. The money received for the house was deposited into the estate of J.M.D account and a check was then forwarded to the state. I am now worried that somehow there are now some kind of taxes due on this, and there is no money in the account to pay for this.