Error on Form 6252 Installment Sale Income for Est...
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BraJo
Level 2

Error on Form 6252 Installment Sale Income for Estate Return 1041

I am the executor of an estate that received income from an installment sale of the decedent's farm including primary residence. In years prior to the decedent's passing, they filed Form 6252 with their Form 1040 return. I am doing the estate's taxes using TurboTax Business 2019 to file the Estate Return Form 1041. 

 

The program is giving an error on Form 6252 saying that line 15 ("If the property described on line 1 was your main home, enter the amount of your excluded gain. Otherwise, enter -0-") should be blank.  But since it WAS their main home when they executed the installment sale, they entered a non-zero value on that line in their tax return the year the sale was made (this affects the Gross Profit Percentage, line 19).  The program is saying Part I (Gross Profit and Contract Price, lines 5-18) are to be completed for all years of the installment agreement, but the 2018 version of Form 6252 that their accountant used when he prepared their taxes for 2018 says that section (Part I) is only required for the first year of the installment agreement.  Is the program in error in saying line 15 should be blank, or is the program in error in saying that Part I is required even after the first year of the installment agreement, or have I (and their accountant in previous years) actually made an error? 

3 Replies
AmeliesUncle
Level 11

Error on Form 6252 Installment Sale Income for Estate Return 1041


@BraJo wrote:

2018 says that section (Part I) is only required for the first year of the installment agreement. 


That was correct in 2018.  But starting in 2019, it is required on all returns.

 

Does that answer your question?

tagteam
Level 15

Error on Form 6252 Installment Sale Income for Estate Return 1041

@AmeliesUncle is correct:

 

What’s New

Installment sale reporting. In 2019 and later, if you have an outstanding installment sale balance after the initial year, complete lines 1 through 4, Part I, and Part II for each year of the installment agreement.

 

See https://www.irs.gov/pub/irs-pdf/f6252.pdf

BraJo
Level 2

Error on Form 6252 Installment Sale Income for Estate Return 1041

That answers part of my question. It explains why I have to complete Part I this year; thanks!  However, it doesn't answer the following part of my question:

 

The program is giving an error on Form 6252 saying that line 15 ("If the property described on line 1 was your main home, enter the amount of your excluded gain. Otherwise, enter -0-") should be blank.  But since it WAS their main home when they executed the installment sale, they entered a non-zero value on that line in their tax return the year the sale was made (this affects the Gross Profit Percentage, line 19).  Is the program in error in saying line 15 should be blank? The property was farming property (hence I selected 3, Farming Property, for the property type code on line 1) that included their primary residence/main home, hence they have excluded gain for the value of the home.

 

What do I have to do to fix the error?

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