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How do I report installment sales?

taxu2
Level 4

Client is selling farm equipment in installments. Was wondering how I report this. And what do I put under dispositions in assets? Any help would be greatly appreciated. Thank you! 

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IRonMaN
Level 15

Yes, use the dispositions section and click on the 6252 box.  However, depending on how much depreciation was taken, the whole gain may end up stuck in 2017 because of depreciation recapture.


Slava Ukraini!

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8 Comments 8
IRonMaN
Level 15

Yes, use the dispositions section and click on the 6252 box.  However, depending on how much depreciation was taken, the whole gain may end up stuck in 2017 because of depreciation recapture.


Slava Ukraini!
Just-Lisa-Now-
Level 15
Level 15
Just in case you cant find the disposition area...scroll down several screen lengths in the asset entry worksheet of the equipt that was sold.

♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪
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taxu2
Level 4
Thanks a bunch!
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IRonMaN
Level 15
You betcha!

Slava Ukraini!
taxu2
Level 4
Turns out they are taking a loss, so they can't take the installment sale option.  So, even though they are accepting payment over 5 years, would I just include the total sales price this year and none the reminder of the 4 years?
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IRonMaN
Level 15
Yes.  But remember to pick up the interest each year.

Slava Ukraini!
taxu2
Level 4
Okay, thanks!
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IRonMaN
Level 15
:+1::+1:

Slava Ukraini!