Instructions For Form 1099-S - Proceeds From Real Estate Transactions

the transferee is the person listed first on the ownership transfer

an allocation received on or after the due date of Form 1099-S

documents.

(without extensions).

3. Designation agreement. You can enter into a written

If no gross proceeds are allocated to a transferor because no

agreement at or before closing to designate who must file Form

allocation or an incomplete allocation is received, you must

1099-S for the transaction. The agreement will identify the

report the total unallocated gross proceeds on the Form 1099-S

person responsible for filing if such designated person signs the

made for that transferor. If you do not receive any allocation or

agreement. It is not necessary that all parties to the transaction

you receive conflicting allocations, report on each transferor's

(or that more than one party) enter into the agreement.

Form 1099-S the total unallocated gross proceeds.

You may be designated in the agreement as the person who

Spouses. If the transferors were spouses at the time of closing,

must file if you are the person responsible for closing the

who held the property as joint tenants, tenants by the entirety,

transaction (as explained in (1) under

Who Must

File, earlier),

tenants in common, or as community property, treat them as a

the transferee's or transferor's attorney (as explained in (1)

single transferor. Only one Form 1099-S showing either of them

under

Who Must

File, earlier), the title or escrow company that is

as the transferor is required. You need not request an allocation

most significant in disbursing gross proceeds, or the mortgage

of gross proceeds if spouses are the only transferors. But if you

lender (as explained in (2a) under

Who Must

File, earlier).

receive an uncontested allocation of gross proceeds from them,

The designation agreement may be in any written form and

file Form 1099-S for each spouse according to the allocation. If

may be included on the closing statement. It must:

there are other transferors, you must make a reasonable effort to

a. Identify by name and address the person designated as

contact either spouse to request an allocation.

responsible for filing,

Partnerships. If the property is transferred by a partnership, file

b. Include the names and addresses of each person

only one Form 1099-S for the partnership, not separate Forms

entering into the agreement,

1099-S for each partner.

c. Be signed and dated by all persons entering into the

Multiple Assets Sold

agreement,

d. Include the names and addresses of the transferor and

If real estate is sold or exchanged and other assets are sold or

transferee, and

exchanged in the same transaction, report the total gross

proceeds from the entire transaction on Form 1099-S.

e. Include the address and any other information necessary

to identify the property.

TINs

Each person who signs the agreement must keep it for 4 years.

You must request the transferor's TIN no later than the time of

closing. The TIN request need not be made in a separate

For each transaction, be sure that only one person is

mailing. Rather, it may be made in person, in a mailing that

responsible for filing and that only one Form 1099-S is

TIP

includes other items, or electronically. The transferor is required

filed for each transferor.

to furnish his or her complete, non-truncated TIN and to certify

that the TIN is correct. For U.S. persons (including U.S. resident

Employees, Agents, and Partners

aliens), you may request a TIN on

Form W-9, Request for

If an employee, agent, or partner, acting within the scope of such

Taxpayer Identification Number and

Certification. Foreign

person's employment, agency, or partnership, participates in a

persons may provide their TIN to you on the appropriate

Form

real estate transaction, only the employer, principal, or

W-8. See part J in the 2018 General Instructions for Certain

partnership (not the employee, agent, or partner) may be the

Information Returns.

reporting person. However, the participation of a person listed

on the HUD-1 as the settlement agent acting as an agent of

Alternatively, you may provide a written statement to the

another is not attributed to the principal.

transferor similar to the following: “You are required by law to

provide (insert name of person responsible for filing) with your

Foreign Transferors

correct taxpayer identification number. If you do not provide

(insert name of person responsible for filing) with your correct

Sales or exchanges involving foreign transferors are reportable

taxpayer identification number, you may be subject to civil or

on Form 1099-S. For information on the transferee's

criminal penalties imposed by law.”

responsibility to withhold income tax when a U.S. real property

interest is acquired from a foreign person, see

Pub. 515,

The solicitation must contain space for the name, address,

Withholding of Tax on Nonresident Aliens and Foreign

Entities.

and TIN of the transferor, and a place to certify under penalties

Multiple Transferors

of perjury that the TIN furnished is the correct TIN of the

transferor. The certification must read similar to: “Under

For multiple transferors of the same real estate, you must file a

penalties of perjury, I certify that I am a U.S. person or U.S.

separate Form 1099-S for each transferor. At or before closing,

resident alien and the number shown on this statement is my

you must request from the transferors an allocation of the gross

correct taxpayer identification number.”

proceeds among the transferors. The request and the response

are not required to be in writing. You must make a reasonable

If you use a HUD-1, you may provide a copy of such

effort to contact all transferors of whom you have knowledge.

statement, appropriately modified to solicit the TIN, to the

However, you may rely on the unchallenged response of any

transferor. Keep the Form W-9, W-8, or substitute form in your

transferor, and you need not make additional contacts with other

records for 4 years.

transferors after at least one complete allocation is received

(100% of gross proceeds, whether or not received in a single

Separate Charge Prohibited

response). If you receive the allocation, report gross proceeds

You may not charge your customers a separate fee for

on each Form 1099-S accordingly.

complying with the Form 1099-S filing requirements. However,

You are not required to, but you may, report gross proceeds

you may take into account the cost of filing the form in setting the

in accordance with an allocation received after the closing date

fees you charge your customers for services in a real estate

but before the due date of Form 1099-S (without extensions).

transaction.

However, you cannot report gross proceeds in accordance with

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Instructions for Form 1099-S (2018)

Instructions For Form 1099-S - Proceeds From Real Estate Transactions - 2018 Page 3

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