1099-S

Question

I paid a Property Right of Way. Is that reportable or not? Would that be 1099-S?

Answer

Right of way payments can be rent (reported in box 1 of Form 1099-MISC) or a purchase (reported on the Form 1099-S) depending on the length of the agreement.

Generally if the length of time is 30 or more years, it is considered a purchase and is reported on the Form 1099-S.

If the length of time is less than 30 years it is rent and reported in box 1 of Form 1099-MISC.

Please keep in mind your basic reportability issues as well, such as reporting threshholds, when you are making your determination.

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