6252

Forum|Forum|3 years ago
April 10, 2023
3 replies
14 views

client has an installment sale of various properties on Schedule E I marked all depreciation with the date only and I figured the depreciation recapture the problem is I put in the selling price and I also put in the installment sale price cost basis commissions and other expenses the client has received interest only from July 29 th till 12/31/2022 the program is calculation is on the entire sale price and this is not the year of the sale it is not a main home it is calculating the gross profit on line 16 and line 17 is calculating the gross profit but for 2023 they are receiving interest only they have not received the contract sale price to date but will happen sometime this year line 20 asks if this is the year of the sale which i believe should be zero but it is calculating the gross profit where am i going wrong? here Any help????

ProSeries Professional

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dkh

Level 15

"they have not received the contract sale price to date but will happen sometime this year "

So was there a purchase agreement signed in 2022 with interest only for the first year and interest and principal in 2023 ? If yes, then the 6252 would be calculated showing a gross profit. You then enter $0 principal received and $xxx interest for 2022. Client is only taxed on the interest for 2022 and none of the gross profit.

A

AccomacktaxAuthor

Level 3

Yes but what about what they received at closing??? would that be Principal?

dkh

Level 15

Do you have a copy of the purchase agreement? What are the details of the agreement? Was the payment at closing a down payment ? If yes, then it is report as principal received.

T

TaxGuyBill

Level 15

@Accomacktax wrote:

I marked all depreciation with the date only

and I figured the depreciation recapture the problem

Are you "linking" the Asset Entry Worksheets to the 6252?

You aren't entering anything by calling it "recapture", are you? For the most part, real estate doesn't have "recapture", it has "Unrecaptured Section 1250 Gain".

As a side note, it makes things WAY easier to read if you use proper sentences and paragraphs, with capitalization and punctuation. Many people (including me) often just ignore posts like yours because they are difficult to read. So making it easier to read increases the probability that somebody will be able to help you.

PATAX

Level 12

Have done this many times. Pro series does an excellent job on it. Excellent.

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