topic Sold raw land at a loss to a private party and deferred payment and interest on the note When do I pay taxes on the interest, when I earn it or when I receive it? in Deductions & credits

Sold raw land at a loss to a private party and deferred payment and interest on the note When do I pay taxes on the interest, when I earn it or when I receive it?

mahoof542 — Tue, 04 Jun 2019 23:30:51 GMT

Both interest and accrued interest are a lump sum payment several years out. Secured by deed of trust.

Leonard — Tue, 04 Jun 2019 23:30:52 GMT

You will report and pay taxes on the interest when you receive it in the future years.

You need to have constructive receipt of the interest before reporting the interest on your tax return.