Certification of No Information Reporting on Sale or Exchange of Principal Residence - Tax Exemption
Overview of this form
The Certification of No Information Reporting on Sale or Exchange of Principal Residence - Tax Exemption is a legal document that helps determine whether a real estate transaction should be reported to the seller and the Internal Revenue Service using Form 1099-S. This form is essential for individuals selling their primary residences, ensuring they comply with tax reporting requirements. It is specifically designed for homeowners who qualify for tax exemptions and need to certify that their property sale meets certain criteria.
What’s included in this form
- Seller Information: Basic details of the seller, including name, property address, and Taxpayer Identification Number (TIN).
- Seller Assurances: A series of statements the seller must confirm regarding their residency status, previous property sales, and property use.
- Seller Certification: A declaration confirming the truthfulness of the information provided, along with the seller's signature and date.
Common use cases
This form is typically used when you are selling your principal residence and believe that the transaction qualifies for tax exemptions under IRS regulations. It is vital in situations where the seller needs to confirm that the sale proceeds do not require reporting on Form 1099-S due to meeting specific residency and ownership criteria.
Who needs this form
- Homeowners selling their primary residences.
- Sellers who have owned their property for the required duration to qualify for tax exemptions.
- Individuals who have not sold or exchanged another principal residence in the past two years.
- Owners of properties that have not been utilized for business or rental purposes.
Instructions for completing this form
- Identify the seller's name and provide the property address along with the Taxpayer Identification Number (TIN).
- Review and check the applicable seller assurances to confirm eligibility for tax exemption.
- Ensure all relevant information regarding the property's use and ownership duration is accurate.
- Sign and date the certification at the bottom of the form, confirming the truthfulness of the information.
- Provide a forwarding address if necessary for any future correspondence regarding the transaction.
Does this document require notarization?
Notarization is not commonly needed for this form. However, certain documents or local rules may make it necessary. Our notarization service, powered by Notarize, allows you to finalize it securely online anytime, day or night.
Mistakes to watch out for
- Failing to provide accurate seller information, such as name or address.
- Not checking all required assurances, leading to potential issues with IRS reporting.
- Omitting the seller's signature and date, which invalidates the form.
- Using incorrect information regarding property use or previous sales.
Benefits of using this form online
- Convenience: Downloadable formats allow you to fill the form out at your convenience.
- Editability: Easily make changes to the form before finalizing it.
- Reliability: Access professionally drafted templates to ensure compliance with legal standards.
Legal requirements by state
This form is suitable for use across multiple states but may need changes to align with your state’s laws. Review and adapt it before final use.
Quick recap
- The Certification of No Information Reporting is crucial for homeowners selling their principal residence.
- Accurate completion and understanding of the form's requirements can prevent tax reporting issues.
- Always review state-specific regulations to ensure compliance when using this form.
Form popularity
FAQ
If you do receive Form 1099-S, you must report the sale of your home on your tax return, even if you do not have to pay tax on any gain. You must meet all of these qualifications to exclude the gain from the sale of your home from income: You must own the property for at least two of the previous five years.
If you receive an informational income-reporting document such as Form 1099-S, Proceeds From Real Estate Transactions, you must report the sale of the home even if the gain from the sale is excludable. Additionally, you must report the sale of the home if you can't exclude all of your capital gain from income.
Generally, the person responsible for closing the transaction, as explained in (1) below, is required to file Form 1099-S. If no one is responsible for closing the transaction, the person required to file Form 1099-S is explained in (2), later.
The 1099-S is used to report the proceeds from the sale or exchange of real estate and certain royalty payments.
The 1099-S Certification Exemption Form One of those transactions the sale of a principal residence under certain conditions is not reportable if certain criteria are met.The sale or exchange is of the entire residence and for $250,000 or less; or if married, for $500,000 or less, and the gain is $250,000 or less.
Business structures besides corporations general partnerships, limited partnerships, limited liability companies and sole proprietorships require Form 1099 issuance and reporting but only for amounts exceeding $600; anyone else is 1099 exempt.
If you have not received an expected 1099 by a few days after that, contact the payer. If you still do not get the form by February 15, call the IRS for help at 1-800- 829-1040. In some cases, you may obtain the information that would be on the 1099 from other sources.
Business structures besides corporations general partnerships, limited partnerships, limited liability companies and sole proprietorships require Form 1099 issuance and reporting but only for amounts exceeding $600; anyone else is 1099 exempt.
If you receive an informational income-reporting document such as Form 1099-S, Proceeds From Real Estate Transactions, you must report the sale of the home even if the gain from the sale is excludable. Additionally, you must report the sale of the home if you can't exclude all of your capital gain from income.
