Installment sell expense

Forum|Forum|4 years ago
March 21, 2022
3 replies
16 views

I have a property I sold as an installment sell (contract). I also have a business loan on the property. It is not clear to me on form 6252 where I put my payment on the business loan as an expense. Or is that a different form?

ThomasM125

Level 15

Your business loan payment would not be reported on form 6252. It is not a deductible expense. On form 6252 you report the sale proceeds of the property and the cost basis, the difference between them is your gain, which is used to determine your gross profit percentage that is then applied to the payments you receive each year to determine your taxable gain.

Since the cost reported includes the loan amount, you can't deduct the loan amount in addition to the cost from the sale proceeds.

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jrpromaxAuthor

Level 2

Thank you for the response. This is the second year of the contract, so what is the right form and where do I enter it in Turbo Tax software? My buyers are behind so it cost me a little more than I brought in.