PatriciaV
Employee Tax Expert

Business & farm

Yes, you are correct. The step-by-step interview does not offer a topic specific to installment sale payments & interest. You can designate that a sale of business/rental property was an installment sale, which will trigger Form 6252. 

 

Any interest paid with the principal received during the year may be entered under Federal >> Income >>Other Income >> All Other Income. Your entry and description will appear on Form 1065 p1-4 Line 7 and on Schedule K Line 14c (SE-Gross nonfarm income).

 

Note that according to IRS Tax Topic 705 - Installment Sales, "You generally report interest on an installment sale as ordinary income in the same manner as any other interest income."

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"