Receipt of Form 1099-A means you owed a lender some money and they have taken the identified property in satisfaction of some or all of the debt. For tax purposes, you are deemed to have “sold” the property to the lender and should report the “sale” according to the normal rules (Form 4797 for business or rental property, Schedule D for personal use property, etc.).
You may have a taxable gain, or if business use property, a deductible loss.
To determine the “sales price”, you must look at Box 5 of the Form 1099-A. If Box 5 is marked “Yes”, you are personally liable for the debt and your “sale price” is the smaller of Box 2, Debt Outstanding”, or Box 4, Fair Market Value of the property taken.
If Box 4 is the smaller amount, you still owe the difference between Box 2 and Box 4. You will eventually have to pay this difference unless it is later forgiven (which triggers debt forgiveness income).
If Box 5 of Form 1099-A is marked “No”, you are not personally liable for the debt and your “sale price” is the amount shown in Box 2, Debt Outstanding. Any amount in Box 4 is ignored.