As a pre-foreclosure, approved to sale property as short sale. The property sold and I only signed paperwork through the mortgage co for the sale. I received no funds from this sale as it sold for substantially lower than what was owed to the mortgage co. I received a 1099-S in the mail. The only figures included on this form is the price that the home sold for. Am I to file the 1099-S with my tax return?

Yes... all forms such as that are to be included in your return.

Actually, the Form 1099-S is NOT included in your return because it shows a sale for a LOSS, which is NOT reported on the tax return if the house is primary home.

If the house is an investment property, then the Form 1099-S is used as a source document for the starting point to determine the SALES price of the porperty.

You may be getting other forms from this sale, to include Form 1099-A and 1099-C. If such forms are received and this house is your primary home, you need to get professional tax help to prepare your tax return, because the amount on Form 1099-C is considered to be taxable income by the IRS. There is a process by which the tax on the Form 1099-C can be forgiven, but you must meet certain criteria.

THAT is the reason you need professional tax help!