Installment Sales
Installment Sales 2-hr. course discusses the particulars of installment sales, including requirements, calculations, and pitfalls. Cross issues such as a combined installment sale and like-kind exchange, the impact of related parties, pledging, repossession and contingent payments are reviewed. Also, the importance of recognizing the dangers of dealer status, inventory, purchase price allocation, and installment note disposition are emphasized.
Course Information
Price: $24
This course is included in our Mega CPE Subscription and our Unlimited Tax Bundle.
Course No. M100
Format: Online pdf (65 pages). Printed book available.
Prerequisites: General understanding of federal income taxation
Advance Preparation:None
Level: Overview
CPE Credit: 2 hrs.
Field of Study: Taxes: Technical
Course expiration: You have one year from date of purchase to complete the course.
Course Revision Date: February 2024
Objectives
Course topics:
* Installment method
* Installment income
* Imputed interest & OID
* Related party sales
* Like-kind exchanges
* Contingent payments or price
* Sale of a business
* Dealer dispositions
* Installment notes in excess of $5 million
* Dispositions of installment obligations
Upon completion of this course you should be able to:
1. Recognize the importance, particularly in tax deferral, of the installment method and, identify §453 requirements and installment method terminology.
2. Specify the imputed interest, OID, and §1038 repossession rules affecting installment sales and subsequent repossessions.
3. Identify the following §453 pitfalls and complexities: the related party limitation, the regulations governing the use of the installment sale method in like-kind exchanges, and the contingent payment sale rules.
4. Determine how to allocate and report installment payments among identified asset classes using R.R. 76-110 and the residual method recognizing §453 prohibitions on certain assets regarding dealer dispositions and inventory.
5. Identify the amount of interest payable on tax-deferred income when §453 dispositions exceed $5 million and circumstances considered taxable dispositions of installment obligations to determine when any gain or loss is recognized.
