Cash For Keys Program: Financial institutions initiating a foreclosure process on a home indicates that it is willing to pay the homeowner a set amount of cash in exchange for the keys to the home. The cash may be based on a percentage of the appraised value of the home or it may simply be a set amount. The financial institutions are making these payments through the new "Cash for Keys Program". The financial institution reports these payments to the Internal Revenue Service on Form 1099-MISC. These payments are reported as other income on Schedule 1 (Form 1040), line 21.
To enter or review the information for Form 1099-MISC, Box 3 Other Income:
If you also have federal and/or state tax withholding reported in Box 4 or 16, see Form 1099-MISC - Box 4 or Box 16.