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1099 Misc Or 1099 S For Granting An Easement

Corporate Law Discussions

1099 Misc Or 1099 S For Granting An Easement

Postby Edouard » Wed Nov 09, 2016 5:40 pm

s About Taxes)/1099 misc or 1099 S for granting an easement Advertisement Expert: Randall Klein, MBA, EA - 4/6/2011 I received a 1099 misc for granting an easement for a gas company to run a pipeline on a farm I own.  I received a 1099 misc from the gas company.  There were initially two checks one for the easement and one for the damages there is a total of the two on the 1099 misc.  How do I claim this on my taxes?  Should this have been a 1099 S?  Thanks
Edouard
 
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1099 Misc Or 1099 S For Granting An Easement

Postby Tyree » Sun Nov 13, 2016 1:16 am

1099 MISC is miscellaneous, so as long as it wasnt put into Box 7, non-employee comp, you should be able to handle this with no problem.

The amount for damages should go on Line 21, other income, with a NEGATIVE amount ALSO on Line 21 to offset the first amount to show that it is a non-taxable receipt for damages. This way, the IRS will be able to match up the amount on the 1099. The amount you received for the easement can go on 4797 Sale of Business Property. You could use the cost of the land as basis in the ratio it was purchased from you. Example: You bought 100 acres at $100/acre for a total of $10,000. You sold an easement equal to 0.5% of your land for $500. Your basis is 0.5% of the 10,000 or $50. So your 4797 Long Term profit is $450.  
Tyree
 
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Joined: Tue Mar 25, 2014 1:48 pm


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