I sold my home and farm ground separately to my son. The home is to be paid first 30 payments. Then the farm ground. Since I won't be realizing any principle for about three years on the farm ground. How do I report this sale?

[SabrinaD2]

When you sell property and receive payments over time, you can use the installment sale method to report the sale. This method allows you to report the gain as you receive payments, rather than all at once.

To report an installment sale in TurboTax see below:

1. Be sure you are logged into TurboTax for links to work,
2. Open or continue your return.
3. Navigate to the installment sales section:
   • TurboTax Online/Mobile: Go to installment sales.
   • TurboTax Desktop: Search for installment sales and select the Jump to link.
4. Check the box next to Sales of real estate, cars, or anything else for which you receive payments over two or more tax years (installment sales). Select Continue.
5. Answer Yes to Do you want to report an installment sale?
6. Follow the instructions to enter your sale details.

Note:

• Since you won't be realizing any principal for about three years on the farm ground, you can report the gain from the home and the farm ground separately as you receive payments.
• TurboTax will create
  • Form 6252: Use Form 6252, Installment Sale Income to report the sale in the year it occurs and for each year you receive an installment payment.
  • Schedule D and Form 8949 if needed: 

.

For more detailed information, you can refer to IRS Publication 537, Installment Sales.