- 15 -
defined as a disposition of property where at least one payment
is to be received after the close of the taxable year in which
the disposition occurs. Sec. 453(b)(1). Income from an
installment sale is to be taken into account using the
installment method, unless a taxpayer elects not to have the
method apply. Sec. 453(a), (d). Generally, the election not to
report a disposition of property on the installment method is
made by the due date of the taxpayer's return for the year in
which the disposition occurs, and in the manner prescribed by the
appropriate tax forms for that return. See Bolton v.
Commissioner, supra; see also sec. 15A.453-1(d)(3), Temporary
Income Tax Regs., 46 Fed. Reg. 10718 (Feb. 4, 1981).
Specifically, a taxpayer who reports an amount realized equal to
the selling price including the full face amount of any
installment obligation on the tax return filed for the taxable
year in which the installment sale occurs will be considered to
have made an effective election. Sec. 15A.453-1(d)(3)(i),
Temporary Income Tax Regs., supra. Generally such an election is
irrevocable and may only be revoked with respondent's permission.
Sec. 15A.453-1(d)(4), Temporary Income Tax Regs., supra.
Petitioner filed his 1991 Federal income tax return and
reported the full amount of the gain realized from the real
property sale. Petitioner has not shown that respondent
consented to a revocation of his effective election out of the
installment method. Accordingly, respondent is sustained on this
issue.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 Next
Last modified: May 25, 2011