Q. Will I be taxed at ordinary income if my main home sale gain was under $250,000 but it is considered a "installment sale" because I received 20% down payment in 2024?
A. No. Furthermore, if you meet the 2 out of 5 year rule, you will also not be taxed at capital gains rates. The installment sale setup does not disqualify you from the homes sale exclusion.
You do have to report the interest as ordinary income.
