Question

The IRS is claiming that a primary residence I sold in 2018 is 100% gain PLEASE HELP!

Forum|Forum|5 years ago
April 21, 2021
1 reply
0 views

I owned a house in 2018 that I had lived in for 3.5 years. I bought the house in 2015 for $300k and sold it in 2018 for $350k. I received a letter in the mail stating I didnt claim a $350k profit on the house and the tax liability is somewhere in the $150k range. I sent a response with a statement stating that this was my sole and primary residence, a copy of the HUD-1 statement from the purchase of the property, and the final settlement statement from the sale of the house which easily shows the gain was only $50k from the property. I received another letter today stating that, from what I sent, there is no sufficient evidence and Im still liable for $350k of income. This is truly outrageous as I provided itemized evidence and a coherent explanation. What do I do now? It seems like they are trying to strong arm me and it feels criminal. Any advice would be greatly appreciated. Thanks

Carl11_2

Employee

Visit your local tax advocacy office. To find the office closest to you, visit https://www.taxpayeradvocate.irs.gov/contact-us/

Critter-3

Your response was not sufficient and it was dismissed. You must have gotten a form 1099-S from the sale and failed to enter it on the original tax return and then when presented with the IRS CP2000 notice you did not respond appropriately so they ignored your response. This is a time where doing this yourself is ill advised so getting local professional assistance would be wise if the tax payer advocate or the local IRS office cannot help. Sadly you may have run out of time to fight the IRS determination and/or you may need to go to tax court.

N

nickweemsAuthor

I never received a 1099-S notice...and from what I understand they wouldnt issue one if it was under $250k in profit. They sent another reponse and are allowing me to reply, with 'sufficient evidence' that I only profited off my sole and primary residence $50k, by MAY 8. My question is how do I go above providing them with copies of original HUD-1 and final settlement statements from the sale. The address was listed on my Drivers License, Tax return address, and voters registration during that period.