![]() ![]() The recaptured depreciation is then added to the basis of the property to calculate the capital gain, which will be taxed at the capital gain rate. Any depreciation claimed on the property must be recaptured and reported in the sale year, which will be taxed at the rate that applies, depending on the type of property. The applicable tax rate applied to any gains depends on when the payment was received, not on the sale date. However, losses cannot be deferred using the installment method. ![]() Without the installment method, the taxpayer would have to report a large gain even though most of the proceeds of the sale have yet to be received, because the gain would otherwise have to be reported in the year of disposition. The installment method of reporting taxes was enacted by Congress so that taxpayers can pay taxes on the sale or other disposition of property over time, when the payments from an installment sale are actually received. Installment Sales Taxation › Money › Taxes › Investment Taxes Installment Sales TaxationĪn installment sale, for tax purposes, is the sale of property paid for by installment payments that span more than 1 tax year.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |