How to Complete IRS Form 1099-S: Boxes, Deadlines, and Corrections

To fill out Form 1099-S, pull the closing date, gross proceeds, and property address from the Closing Disclosure, enter the filer’s and seller’s names and TINs, complete Boxes 1 through 6, and file with the IRS and furnish the seller their copy by the deadlines that follow the year of closing. The form reports the gross proceeds of a real estate sale to the IRS so it can match the figure against the seller’s capital gains reporting.

Confirm You Are the One Who Has to File

The filing duty falls on the person responsible for closing the transaction, which in practice means the settlement agent, title company, or attorney listed on the Closing Disclosure. If no Closing Disclosure was used, it falls to whoever prepared the settlement documents or disbursed the proceeds. The parties can sign a written designation agreement at or before closing that shifts the filing duty to someone else in the deal; only the designated person must sign it.¹

Check Whether the Sale Is Exempt

Some transactions do not require the form at all. The most common exemption is a principal residence sale of $250,000 or less ($500,000 if the seller certifies as married), where the seller gives you a written certification, signed under penalties of perjury, stating that the property was their principal residence, the full gain is excludable under Section 121, and there was no period of nonqualified use after December 31, 2008. You can collect the certification any time on or before January 31 of the year after the sale, and you must keep it for four years. Without it, you file regardless of the sale price.¹

Other exempt situations include sales where the seller is a corporation, publicly traded partnership, governmental unit, or exempt volume transferor; gifts, bequests, and transfers between spouses under Section 1041; transfers in satisfaction of a debt, including foreclosures and deeds-in-lieu; transactions where total consideration is determinably less than $600; and burial plot sales.¹

One reporting trap worth flagging: a like-kind exchange with zero cash proceeds still requires a 1099-S. Enter zero in Box 2 and check Box 4.¹

Where the Numbers Come From

Download the current form from the IRS website or generate it through authorized tax software. Every figure you enter comes from the Closing Disclosure, or, for older transactions, the HUD-1 settlement statement.²

Filer and Transferor Information

In the upper-left section, enter the filer’s name, address, and TIN. In the transferor fields, enter the seller’s full legal name, mailing address, and Taxpayer Identification Number (Social Security Number or EIN). An incorrect or missing TIN is one of the most common errors that draws an IRS notice, so verify it against the seller’s W-9 or the settlement paperwork before you submit.

Complete Boxes 1 Through 6

Box 1: Date of Closing

Enter the date on the signed Closing Disclosure or settlement statement. That date fixes which tax year the sale falls into.¹

Box 2: Gross Proceeds

Report the total gross proceeds from the sale. Gross proceeds include all cash the seller received or will receive, the stated principal of any note payable to the seller, and any mortgage paid off at settlement. If the buyer assumes a liability of the seller or takes the property subject to a liability, include that amount as well. For a transaction involving only cash and notes, gross proceeds will usually equal the contract sales price.¹

Do not reduce gross proceeds for the seller’s expenses such as commissions, deed preparation fees, advertising, or legal costs. Do not include separately stated amounts paid for personal property like appliances or window treatments. For a like-kind exchange with no cash, enter zero.¹

Box 3: Address or Legal Description

Enter the street address of the property, including city, state, and ZIP code. If the property has no street address, use the legal description or the assessor’s parcel number from the Closing Disclosure or deed.¹

Box 4: Property or Services Checkbox

Check this box if the seller received or will receive property other than cash, or services, as part of the consideration. It covers like-kind exchanges and any deal where the seller got something besides money.¹

Box 5: Foreign Person Checkbox

Check this box if the seller is a nonresident alien, foreign partnership, foreign estate, or foreign trust. A foreign seller also triggers FIRPTA withholding: the buyer or closing agent must file Forms 8288 and 8288-A separately to report and remit the withholding tax, generally within 20 days of closing.³

Box 6: Buyer’s Part of Real Estate Tax

For residential transactions, enter the portion of prepaid real estate tax that is allocable to the buyer. Taxes paid in arrears do not go here. The IRS example: if the seller prepaid $1,200 in annual property tax and the sale closed at the end of the ninth month of the tax year, $300 is allocable to the buyer.¹

If There Is More Than One Seller

File a separate 1099-S for each transferor and show the total gross proceeds on each form. You do not have to allocate each seller’s share on the form itself.¹

Married co-sellers get more flexibility. If the spouses held the property as joint tenants, tenants by the entirety, tenants in common, or community property, you can report the full amount under the primary transferor, split it between the two, or allocate it any other reasonable way. For partnership-owned property, you can report the full proceeds to the partnership or to each partner individually.¹

Filing Deadlines and How to Submit

Three dates apply, all tied to the year of closing:

February 15: furnish the seller their copy.
February 28: file paper copies with the IRS, postmarked by this date.
March 31: file electronically through the IRS IRIS portal (which replaced FIRE) by 11:59 p.m.

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A deadline that lands on a Saturday, Sunday, or legal holiday moves to the next business day.⁴ If you file 10 or more information returns of any type during the year, electronic filing is mandatory. The threshold counts all information returns combined, not only 1099-S forms.⁵

Fixing a Mistake After Filing

For a wrong dollar amount, code, or checkbox (Type 1 error), prepare a new 1099-S with the correct information, check the “CORRECTED” box at the top, and submit it with a new Form 1096. Furnish a corrected copy to the seller.⁶

For a wrong TIN or wrong seller name (Type 2 error), you file two forms. First, a return with the “CORRECTED” box checked that mirrors the original but zeros out every dollar amount, which tells the IRS to disregard the original. Second, a return with no “CORRECTED” box that contains the correct information as though it were a new original. Both go under one Form 1096 with a note in the bottom margin explaining the reason, for example “Filed To Correct TIN.”⁶

If you filed a return that should not have been filed at all, submit a corrected return with zero in every dollar box, check “CORRECTED,” and send the seller a corrected copy.

Penalties for Late or Incorrect Filing

For returns due in 2026, penalties scale with how long the problem goes uncorrected:

Up to 30 days late: $60 per return.
31 days late through August 1: $130 per return.
After August 1 or not filed: $340 per return.
Intentional disregard: $680 per return, no cap.

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The penalties apply separately to the return filed with the IRS and to the statement furnished to the seller, so a single missed filing can generate two charges. A mismatched name or TIN can produce a further notice. Small businesses face lower overall maximums, but no maximum applies where the IRS finds intentional disregard.⁷

1
Internal Revenue Service. Instructions for Form 1099-S – Proceeds From Real Estate Transactions
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Internal Revenue Service. About Form 1099-S, Proceeds from Real Estate Transactions
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Internal Revenue Service. Reporting and Paying Tax on U.S. Real Property Interests
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Internal Revenue Service. 2026 Publication 1099
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Internal Revenue Service. E-File Information Returns
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Internal Revenue Service. General Instructions for Certain Information Returns
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Internal Revenue Service. Information Return Penalties