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April 16, 2022
Question

rental property that was sold but over time not one lump sum

  • April 16, 2022
  • 1 reply
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We had rental property that we sold in 2021 to a couple over time We recorded the income in the rental section over the years. Now the property has been put in their name. How do I record this for 2021

    1 reply

    ColeenD3
    April 16, 2022

    You report your sale over more than one year on Form 6252, Installment Sale.

     

    An installment sale is a sale of property where you receive at least one payment after the tax year of the sale. You can read more about it here. Here’s how to report one in TurboTax:

    1. Open your return in TurboTax.
    2. In the search box, search for installment sales 
    3. and select Jump to installment sales.
    4. Check the box next to Sales of real estate, cars, or anything else for which you receive payments over two or more tax years (installment sales). Select Continue.
    5. Answer Yes to Do you want to report an installment sale?
    6. Follow the instructions to enter your sale details.

    Under the installment method, you include in income each year only part of the gain you receive or are considered to have received. You don't include in income the part of the payment that's a return of your basis in the property. Use Form 6252, Installment Sale Income   (TurboTax will do this) to report an installment sale in the year the sale occurs and for each year you receive an installment payment.