Do you receive 1099 after short sale?

You must report your property sale in the same year you do the short sale if you received one of these: Form 1099-S.

What is short sale and how does it work?

A short sale is when a mortgage lender agrees to accept a mortgage payoff amount less than what is owed in order to facilitate a sale of the property by a financially distressed owner. The lender forgives the remaining balance of the loan.

Who benefits from a short sale?

For the seller, a short sale presents less damage to his credit report than a foreclosure, and allows him to recover and buy a new house more quickly. This sense of cooperation between the seller and buyer may facilitate the exchange and get the new owner into the house more quickly.