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    Land Sale

    Client is going to sell some land. The buyer will pay the bank the total amount of the purchase price in 2012. The bank has agreed to hold part of the selling price in an escrow account. My question is whether the seller has constructive receipt? Does he have to report the entire land sale? Or, can he report, on an installment sale basis, the amount he receives and report the payment received from the escrow account in the next year?

    #2
    Originally posted by tonia2021 View Post
    Client is going to sell some land. The buyer will pay the bank the total amount of the purchase price in 2012. The bank has agreed to hold part of the selling price in an escrow account. My question is whether the seller has constructive receipt? Does he have to report the entire land sale? Or, can he report, on an installment sale basis, the amount he receives and report the payment received from the escrow account in the next year?
    Start by reading the escrow agreement as to who has legal rights to the escrowed amount and when these rights occur.

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      #3
      Originally posted by tonia2021 View Post
      The bank has agreed to hold part of the selling price in an escrow account.
      WHY is the bank doing this?

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