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The loan is just for the land. Any structures on the property were added after the original purchase. Do I need to provide any yearly documents to the person paying back the loan?
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If the monthly income is the repayment of your capital plus interest, then you need only to report the interest income on your return. You will issue a form 1098-INT to the person who is paying you the interest. This form is due to the IRS on January 31 of each year.
If you paid less for the note than the capital repayment (e.g. you paid $8,000 to receive $10,000 in capital repayments, plus interest) then you will record an installment sale on your return, if the payments will come over two or more tax years.
To record an Installment sale in TurboTax:
If the monthly income is the repayment of your capital plus interest, then you need only to report the interest income on your return. You will issue a form 1098-INT to the person who is paying you the interest. This form is due to the IRS on January 31 of each year.
If you paid less for the note than the capital repayment (e.g. you paid $8,000 to receive $10,000 in capital repayments, plus interest) then you will record an installment sale on your return, if the payments will come over two or more tax years.
To record an Installment sale in TurboTax:
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