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Mark D
Mark D, Enrolled Agent
Category: Tax
Satisfied Customers: 1304
Experience:  MBA, EA, Specializing in Business and Individual Tax Returns and Issues
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My late father sold s home less than a year before he died.

Customer Question

My late father sold his home less than a year before he died. He financed the loan to the buyer, so the buyer paid him interest/principal monthly. Now that my father has died, I'm not getting those payments (split with my sibling). The house was worth $50,000 and my half of the annual interest/principal payments is about $3000. Is this taxable income that i need to declare?
Submitted: 1 year ago.
Category: Tax
Expert:  Mark D replied 1 year ago.

Hello, the actual loan balance would have received a step up in basis upon inheritance, so they would be no tax due on principal [payments. However, any interest payments you receive you would report on your Schedule B of Form 1040 as interest income. Please rate if this answers your question.

Customer: replied 1 year ago.
Should I have received at 1099 form from the title company that the payments go through?
Expert:  Mark D replied 1 year ago.

Some do not, instead they send a substitute statement attached to the year end statement

Expert:  Mark D replied 1 year ago.

Please rate my service if I answered your question as that is how I am paid.

Expert:  Mark D replied 1 year ago.

Did that answer your question? If so, please rate my service as that is how I am paid.