A. Technically, you’re correct. However, if you simply defer all payments to the year after the year of the sale, you do not receive any tax benefit other than deferral. Another tax objective of an installment sale may be to spread out the taxable gain over two or more years. Typically, you would arrange for an installment payment in the year of the sale and at least one more in the following year.
Tip: For this reason, installment sales are a valuable year-end planning technique. For instance, payments may be received in December 2010 and January 2011.
Like what you've read? ...Republish it and share great business tips!
Attention: Readers, Publishers, Editors, Bloggers, Media, Webmasters and more...
We believe great content should be read and passed around. After all, knowledge IS power. And good business can become great with the right information at their fingertips. If you'd like to share any of the insightful articles on BusinessManagementDaily.com, you may republish or syndicate it without charge.
The only thing we ask is that you keep the article exactly as it was written and formatted. You also need to include an attribution statement and link to the article.
" This information is proudly provided by Business Management Daily.com: http://www.businessmanagementdaily.com/11994/installment-sales-2-years-are-better-than-1 "