Sch D-eic

[gman]

If property is sold on the installment sale and the amount recieved is less than the EIC investment income level, client could still recieve EIC??

Total sales price would put taxpayer over the limit for investment income and make client ineligible for EIC, but if on the installment, I believe they could qualify for EIC as long as current years payment was less than investment income level.

Is this correct?

[fliszt]

as long as

the investment credit does not exceed $2900 and client meets AGI limits along with other eligibility criteria, I don't see any problems.

[Koss]

Wait a minute...

I don't see how the total purchase price is relevant. The issue is the amount of capital gain income.

I'm interested enough in this that I'm gonna do some digging here...

BMK

[Koss]

Installment Sale Income

The question of whether they can claim EIC is determined by the amount of their investment income.

Investment income, in this context, is defined as:

(i) interest on lines 8a and 8b
(ii) dividends on line 9a
(iii) capital gain on lines 10 and 13
(iv) rental and royalty income that flows from Schedule E

Installment sale income flows from Form 6252... to Form 4797... to Schedule D... to line 13.

Use Worksheet 1 on page 8 of Pub. 596.

BMK