Does the IRS know when you buy a house?
In reality, if the IRS does not already know when you buy or sell a house, it is just a matter of time before they find out..
How does the IRS know your cost basis?
This method is called “first in first out” (FIFO). Here’s how FIFO works: Let’s say you sell 200 shares of a 2,000-share portfolio that you purchased over time. With FIFO, the IRS expects you to use the price of your oldest shares — the ones you purchased or otherwise acquired first — to compute your cost basis.
Do I have to report the sale of my home to the IRS?
Reporting the Sale Do not report the sale of your main home on your tax return unless: You have a gain and do not qualify to exclude all of it, You have a gain and choose not to exclude it, or. You have a loss and received a Form 1099-S.
How does IRS know your primary residence?
But if you live in more than one home, the IRS determines your primary residence by: Where you spend the most time. Your legal address listed for tax returns, with the USPS, on your driver’s license, and on your voter registration card.