Sale Propert-09, Rec $ 10

[Jill Graff]

Situation: Client is selling a farm. The buyer wants all of the papers signed in 2009, but no money is to change hands until 2010.

Question: When does seller pick up the sale on their tax return 2009 or 2010?

Thanks in advance.

[Jiggers]

Depends.......

Situation: Client is selling a farm. The buyer wants all of the papers signed in 2009, but no money is to change hands until 2010.

Question: When does seller pick up the sale on their tax return 2009 or 2010?

Thanks in advance.

Installment sale. When payments are received, that is when you report the income.

EXCEPT for the 1245 depreciation recapture. That is reported in the year of sale, irregardless if any money is received.

Be careful on this.

[abctax]

And...

isn't there a requirement for installment sales that there have to be at least two payments?


Wrong...see TTB 6-13. " ......taxpayer receives at least one payment after the tax year of the sale".

Consider the issue of constructive receipt tho; why is there a delay in receiving the funds? Is it the sellers choice to delay receipt?

[ChEAr$]

Hmmm, as that little German soldier on Hee Haw used to say: "Verrrrrryyy INTeresting!

So buyer wants all the papers signed before year's end. He's buying farm and
presumably all the equipment with it. And even if papers signed in 2009,
he might not be placing that equipment into service in 2009 after all.
However..... (speculating......)

ah, I know. He wants 179,
in tax year 2 0 0 9.