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Tax Law (Questions About Taxes)/Reporting Inherited home sale


When I die, and my 4 children sell the home, I suspect that they will receive a 1099-S for the sale price of the home and a 1099-B for the sale price  of any stock.
The IRS also received a copy. How were those totals reconciled with each of the 4 individual 1040 reporting.

Do each of them need to complete Form 8949 and Schedule D for their respective portions of the inheritance.
Is a K-1 needed anywhere in the process.
House is sold for $100,000, and the 1099-S reflects that number, and is reported to the IRS. Does that number appear anywhere in any of the 4 individual 1040's.
Hope you can help.

ANSWER: Nicholas,

Thanks for your question.

Most likely the issuer will only issue one 1099-s and for each transaction. They should each reflect their portion on their respective 8949 and schedule D, with the one whose SSN is on the documents a deduction for the other shares.

They will need to determine the fair market value as of date of death to determine their basis.

A k-1 will be involved only if the assets were sold by the estate or trust rather than the beneficiaries.

Hope this helps.

John Stancil, CPA

---------- FOLLOW-UP ----------

The home is in the name of a family trust (value $400,000).
When I die, is the 1099-S in the name of the which case a K-1 will be required.
Will a separate 1099-S be written for each of the 4 children, showing a sale price of $100,000.....they are the beneficiaries.
Thanks again for volunteering.

ANSWER: Since there is a trust involved, a K-1 will be issued in any year in which a distribution is made to a beneficiary.  If the trust sells the house, the 1099-S would come to the trust.  If the house is transferred to a beneficiary, a 1099-S would be issued to the beneficiaries.  As I explained previously, they will probably only issue one 1099-S and the  beneficiaries would have to split the profit (Loss) as I explained.

Hope this helps.

John Stancil, CPA

---------- FOLLOW-UP ----------

I don't wish to beat a dead horse, but as you say, "....if the house is transferred to the beneficiaries....". Since they are the beneficiaries of the trust, the transfer is made to them the moment I die. As I see it, the house is not sold by the trust, but by them as beneficiaries.
Why is my logic not correct.
Thanks for hanging in on this one.

Unless the trust document specifically states that all properties in the trust automatically transfer upon your death (a highly unusual provision) the property remains in the trust until actually transferred out by an act of the trustee. As long as the property remains in the trust, the trustee controls what happens,

It would crate quite a problem otherwise.  For example, suppose you owned 4 vehicles. If transfer happened automatically, each child would own 1/4 of each vehicle.   I think you can see how troublesome this would be.

John Stancil, CPA  

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John Stancil, CPA


I can answer questions on personal income taxes, partnerships, and some corporate income taxes. I can deal with some state tax questions. Limited gift and estate tax questions. I am also familiar with ministerial and church tax reporting issues. I am Professor Emeritus at Florida Southern College. Sales taxes and property taxes are state and local issues so I am not likely be be able to give you an in depth answer on those types of taxes. I have maintained a CPA practice, specializing in tax, for over 35 years. I am a member of the National Association of Tax Professionals, The Florida Insititute of CPA's, The NCPE Fellowship. In addition I am a Certified Mentor for SCORE. Visit my website at I also offer seminars and consultations to churches and clergy on their tax issues at Also visit my blog, I am listed on Tax Connections at Prepare and file your own taxes at


I hold a doctorate in Accounting, and am a CPA. My certifications of CIA, CFM, and CMA are inactive. I passed all certification examinations on the first attempt, and received honorable mention for my scores on the CIA exam. I have operated a CPA firm for over 37 years and have taught accounting and tax at the college level for over 35 years.

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The CPA Journal, Florida CPA Today, Green Consumer, Green Business, Global Sustainability as a Business Imperative, Palmetto Review, NATP TaxPro Quarterly, Mustang Journal of Finance and Accounting.

DBA University of Memphis MBA University of Georgia BS in Accounting Mars Hill University

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