How to File Form 1099-A: A Step-by-Step Guide

If the headline grabbed your attention, we’ll assume that you’re probably struggling to figure out form 1099-A or you want to know how to file form 1099-A. You’ve come to the right place. In this blog we’ll break down everything about this blog for you to stay penalty free.

What is Form 1099-A?

The official title of Form 1099-A is “Acquisition or Abandonment of Secured Property”. It’s basically an information return the payers file with the IRS when they take back property from a borrower or when they realize the borrower has walked away from it.

If you’re a bank, credit union, mortgage lender, finance arm, or similar payer, you’ll file Form 1099-A in these two main situations:

• Foreclosure or repossession: When a lender legally takes back property whether that’s a house after foreclosure proceedings, a repossessed car, or seized business equipment.
• Abandonment: When a borrower walks away from the property, leaves the keys, stops making payments, and ghosts the lender entirely.

There are three copies to pay attention to: Copy A goes to the IRS, Copy B goes to the borrower, and Copy C stays with the lender for your records.

Note: There’s no dollar limit on when you need to file. Even if the property or loan is relatively small, Form 1099-A is required.

Why Does Form 1099-A Matter?

Form 1099-A matters for both lenders and borrowers. Why?

When a property is foreclosed or abandoned, the form captures important details like the property’s fair market value and how much was still owed on the loan. These numbers help the IRS determine whether the borrower has taxable gain or loss from a foreclosure. It’s basically the IRS foreclosure reporting form.

For lenders, filing it accurately protects them from penalties and keeps their records audit-ready. The penalties aren’t small. They start at $60 per form and escalate quickly if you’re late or if forms are missing entirely. The penalties increase to $130, then $330, and reach $660 per form for intentional disregard. For borrowers, it’s the document that helps determine their tax obligations after losing property.

What Information Goes on Form 1099-A?

Form 1099-A is just one page. But it has some key details:

• The date the property was acquired or abandoned
• The outstanding loan balance on that date
• The fair market value (FMV) of the property or what it is worth.
• A short description of the property
• Whether the borrower was personally liable for the debt (the checkbox for personal liability)

The IRS uses this information to check if the borrower might have a gain or loss from foreclosure or abandonment.

Form 1099-C Connection

There’s also an important overlap with Form 1099-C (cancellation of debt):

If, in the same calendar year, you cancel a debt of $600 or more in connection with the foreclosure or abandonment, you may file Form 1099-C only and meet the 1099-A requirement by completing boxes 4, 5, and 7 on Form 1099-C (if you file both forms, do not complete boxes 4, 5, and 7 on Form 1099-C).

This is one special IRS rule that lets a payer use only 1099-C if it already shows all 1099-A details.

Form 1099-A Box-by-box Guide

Don’t break your head. Refer to these easy-to-follow Form 1099-A instructions to understand what goes where.

Critical Deadlines and Extensions

Missing 1099-A deadlines 2025 is an easy way to attract penalties. Mark these dates. You’ll thank us later!

• Need an extension? File Form 8809 as it gives you 30 extra days to file with the IRS. But it’s not for borrowers.
• Correcting mistakes: Mistakes happen. But what matters is how you act after. Mark CORRECTED at the top and resend both copies to the IRS and the borrower as soon as possible. This minimizes penalties.

Late Filing Penalties

The penalties for late filing 1099-A depend on how late you file the form. So, pay attention because it can add up quickly.

This is the penalty structure: $60 (within 30 days), $130 (by August 1), $340 (after August 1 or not filed), and at least $680 per return for intentional disregard (no maximum).

State Rules and Recordkeeping

And don’t forget about state requirements. The IRS Combined Federal/State Filing Program doesn’t cover Form 1099-A, so you may need to file separately with your state. Check your state’s specific rules.

Keep all your documentation handy. Deeds, appraisals, correspondence with borrowers for at least four years. In case of an audit, you’ll be glad you did.

Another tip: If you resell a vehicle within 90 days, you typically won’t need a second 1099-A. You might need a 1099-C later if you forgive part of the remaining debt.

Filing 1099-A Simplified with Tax1099

Here’s an easy 1099-A step-by-step filing guide using Tax1099:

• Collect your data: Get the borrower’s TIN from their Form W-9, address, the loan payoff sheet, and find the most recent property valuation (appraisal, auction, or sale price).
• Fill all the boxes: You can use the IRS fill-in PDF or the Tax1099 spreadsheet. Double-check dates and dollar amounts.
• Run checks: Verify TINs before you submit. Tax1099 runs these checks automatically, saving a lot of headaches later.
• Choose whether to paper-file or e-File: If you’re filing fewer than 10 total returns across all types, you can file on paper. 10 or more? E-filing is mandatory.
• Send Borrower Copies: Furnish borrower copies by February 2, 2026 (January 31, 2026 falls on a Saturday, so the due date moves to the next business day).
• Send the IRS Copy: Paper filers need to submit by February 28, 2026. E-filers get until March 31, 2026. Need more time? File Form 8809 to request a 30-day extension.

Common Mistakes and How to Avoid Them

• Mixing up loan balance and FMV: Always show the real value, not what’s owed.
• Filing late: Always file corrected returns as soon as possible after identifying an error. This reduces penalties.
• Filing only 1099-A when you’ve also canceled debt: Send Form 1099-C or you can use the combined filing option.
• Missing TINs: File anyway and leave that field blank. Follow the IRS procedures for TIN solicitation and backup withholding.
• Leaving Box 5 blank: The IRS assumes the borrower has no remaining obligation and can over-tax.

Real-World Scenarios

1. Bank forecloses a home with a $210,000 loan balance, but the fair market value is $200,000.

Correct Action: On your 1099-A, Box 2 shows $210,000, Box 4 shows $200,000, and check Box 5

2. A tenant abandons a rental property, leaving the keys behind. The loan has a recourse.

Correct action: File Form 1099-C only if boxes 4, 5, and 7 include all 1099-A information. Otherwise, file both forms.

3. Credit union forecloses on a property and forgives $15,000 of debt.

Correct action: File both 1099-A and 1099-C.

4. Auto lender repossess an SUV after missed payments.

Correct action: File 1099-A showing the repossession date and the auction fair market value.

5. The city seizes farm equipment, and the borrower has no personal liability.

Correct action: File 1099-A but leave Box 5 blank.

FAQs

1. Is there a minimum dollar amount for filing?

No. File for any foreclosure or abandonment, regardless of the property value.

2. What about joint borrowers? How many forms?

File one form per borrower. If they’re married and share the same address and jointly liable, then file just one.

3. Do guarantors get a form?

Only if they’re listed as borrowers on the loan.

4. Can the FMV equal the loan balance?

Only if the payer purchased the property for that exact amount.

5. Can I email the borrower copies?

Yes, once they’ve signed a consent form for electronic delivery.

6. What if I need both 1099-A and 1099-C forms?

Send both, or use the combined filing option if all 1099-A information fits on 1099-C.

Filing Form 1099-A shouldn’t stress you out. Let Tax1099 do the heavy-lifting so that you can focus on running your business instead!

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