How is income received in years after the year of an installment sale reported o
ID: 2602764 • Letter: H
Question
How is income received in years after the year of an installment sale reported on the tax return?
For a tax year in which a principal payment was received, complete Form 6252, lines 1-4 and Part II.
For a tax year in which a principal payment was received, complete Form 6252, lines 1-4 and Part III.
For an installment sale, the amount and nature of the gain is determined in the year of sale. Use the information from the year of sale to complete Form 4797. No additional Form 6252 is required.
For a tax year in which a principal payment was received, complete the entire Form 6252.
How is income received in years after the year of an installment sale reported on the tax return?
Explanation / Answer
correct option is "A"-For a tax year in which a principal payment was received, complete Form 6252, lines 1-4 and Part II.
Explanation:
One has to file form 6252 for any year in which payment from installment sale is received .Also
a)In year of sale ,fill out lines 1 through 4 & part I and II
b)In any other year fill out lines 1 through 4 and part II