I have a question about reporting short sale on taxes. I sold my home in a short sale in 2020 for thousands of dollars less than the amount I owed on it. We didn’t buy another home, and are renting an apartment. Do I have to report the sale on my return?
- You received a 1099-S or other substitute form.
- You claimed the first-time homebuyer credit.
You should subtract your basis and selling expenses from your sales price to figure gain or loss. When reporting, any gain is taxable. Any loss — Such as when you are reporting short sale on taxes — Is a nondeductible personal loss.
You might also have cancellation of debt. It’s reported on Form 1099-C. Cancellation of debt is taxable in the year the debt was cancelled, unless an exception applies.
Learn more about the definition of a 401(k) plan with information from H&R Block. We break down 401(k) rules with easy-to-follow explanations and lists.
Do you know how to report taxes on stock option sales? Learn more from the tax experts at H&R Block.
What is the alternative minimum tax, and are you eligible for an exemption? Learn more about AMT rates and get tax answers at H&R Block.
IRA terms and concepts can be confusing at times. We’re here to help. Find explanations for common IRA terminology from the tax experts at H&R Block.