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Level 2
posted Apr 13, 2025 10:37:54 AM

Can installment method be used to report sale of nonemployee stock with negative basis?

I sold all of stock in a private company (no employment) which had a negative basis (due to historic loss).. Turbo Tax does not allow begative basis. There is also a deferred payment. Can I use installment sale method?

 

 

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1 Replies
Expert Alumni
Apr 17, 2025 2:09:40 PM

Your basis in the stock cannot fall below zero. And, no, you can't report an installment sale that results in a loss.

 

However, you may be able to report the sale of stock as an installment sale using the steps listed in this post from 2019. Note that the menus may have changed and your result may vary.