I sold my one-half ownership of a general partnership to my business partner, effective 12/31/2021. The sale was based on monthly installments for the next few years. The first payment was not collected until mid-January 2022. Do I file a 6252, Installment Sale Income, and/or a 4197, Sale of Business Property? I tried filling out the 6252 but it seems to only ask the sales price and not how much I collected. Therefore, it wants to tax me on the full sales price.
If you received no principal payments on this installment sale, you have no gain on sale to report this year.
Note that in TurboTax Home & Business, installment sales are entered under Personal Income >> Less Common Income >> Installment Sales. This interview includes questions about principal payments you may have received, which is how the gain is recognized for tax purposes.
Patricia, thank you very much for responding. I was aware that I have no gain for 2021. I did not know to use the Personal Income >> Less Common Income >> Installment Sales. With your suggestion, I went through the interview questions and so far it seems to have worked. I was a little confused at first because the question as to Principal and Interest Received would not accept zeros. I eventually left them blank and my Federal Tax Due did not increase, so I assume leaving the field blank was the equivalent of zero. Thank you again!