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How To File Irs Form 1040x

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How To File Irs Form 1040x

How to file irs form 1040x 10. How to file irs form 1040x   Installment Sales Table of Contents Introduction Topics - This chapter discusses: Useful Items - You may want to see: Installment Sale of a Farm Installment MethodWhen to elect out. How to file irs form 1040x Revoking the election. How to file irs form 1040x More information. How to file irs form 1040x Figuring Installment Sale Income Payments Received or Considered Received ExampleSection 1231 gains. How to file irs form 1040x Summary. How to file irs form 1040x Introduction An installment sale is a sale of property where you receive at least one payment after the tax year of the sale. How to file irs form 1040x If you realize a gain on an installment sale, you may be able to report part of your gain when you receive each payment. How to file irs form 1040x This method of reporting gain is called the installment method. How to file irs form 1040x You cannot use the installment method to report a loss. How to file irs form 1040x You can choose to report all of your gain in the year of sale. How to file irs form 1040x Installment obligation. How to file irs form 1040x   The buyer's obligation to make future payments to you can be in the form of a deed of trust, note, land contract, mortgage, or other evidence of the buyer's debt to you. How to file irs form 1040x Topics - This chapter discusses: The general rules that apply to using the installment method Installment sale of a farm Useful Items - You may want to see: Publication 523 Selling Your Home 535 Business Expenses 537 Installment Sales 538 Accounting Periods and Methods 544 Sales and Other Dispositions of Assets Form (and Instructions) 4797 Sales of Business Property 6252 Installment Sale Income See chapter 16 for information about getting publications and forms. How to file irs form 1040x Installment Sale of a Farm The installment sale of a farm for one overall price under a single contract is not the sale of a single asset. How to file irs form 1040x It generally includes the sale of real property and personal property reportable on the installment method. How to file irs form 1040x It may also include the sale of property for which you must maintain an inventory, which cannot be reported on the installment method. How to file irs form 1040x See Inventory , later. How to file irs form 1040x The selling price must be allocated to determine the amount received for each class of asset. How to file irs form 1040x The tax treatment of the gain or loss on the sale of each class of assets is determined by its classification as a capital asset, as property used in the business, or as property held for sale and by the length of time the asset was held. How to file irs form 1040x (See chapter 8 for a discussion of capital assets and chapter 9 for a discussion of property used in the business. How to file irs form 1040x ) Separate computations must be made to figure the gain or loss for each class of asset sold. How to file irs form 1040x See Sale of a Farm in chapter 8. How to file irs form 1040x If you report the sale of property on the installment method, any depreciation recapture under section 1245 or 1250 of the Internal Revenue Code is generally taxable as ordinary income in the year of sale. How to file irs form 1040x See Depreciation recapture , later. How to file irs form 1040x This applies even if no payments are received in that year. How to file irs form 1040x Installment Method An installment sale is a sale of property where you receive at least one payment after the tax year of the sale. How to file irs form 1040x A farmer who is not required to maintain an inventory can use the installment method to report gain from the sale of property used or produced in farming. How to file irs form 1040x See Inventory , later, for information on the sale of farm property where inventory items are included in the assets sold. How to file irs form 1040x If a sale qualifies as an installment sale, the gain must be reported under the installment method unless you elect out of using the installment method. How to file irs form 1040x Electing out of the installment method. How to file irs form 1040x   If you elect not to use the installment method, you generally report the entire gain in the year of sale, even though you do not receive all the sale proceeds in that year. How to file irs form 1040x   To make this election, do not report your sale on Form 6252. How to file irs form 1040x Instead, report it on Schedule D (Form 1040), Form 4797, or both. How to file irs form 1040x When to elect out. How to file irs form 1040x   Make this election by the due date, including extensions, for filing your tax return for the year the sale takes place. How to file irs form 1040x   However, if you timely file your tax return for the year the sale takes place without making the election, you still can make the election by filing an amended return within 6 months of the due date of the return (excluding extensions). How to file irs form 1040x Write “Filed pursuant to section 301. How to file irs form 1040x 9100-2” at the top of the amended return and file it where the original return was filed. How to file irs form 1040x Revoking the election. How to file irs form 1040x   Once made, the election can be revoked only with IRS approval. How to file irs form 1040x A revocation is retroactive. How to file irs form 1040x More information. How to file irs form 1040x   See Electing Out of the Installment Method in Publication 537 for more information. How to file irs form 1040x Inventory. How to file irs form 1040x   The sale of farm inventory items cannot be reported on the installment method. How to file irs form 1040x All gain or loss on their sale must be reported in the year of sale, even if you receive payment in later years. How to file irs form 1040x   If inventory items are included in an installment sale, you may have an agreement stating which payments are for inventory and which are for the other assets being sold. How to file irs form 1040x If you do not, each payment must be allocated between the inventory and the other assets sold. How to file irs form 1040x Sale at a loss. How to file irs form 1040x   If your sale results in a loss, you cannot use the installment method. How to file irs form 1040x If the loss is on an installment sale of business assets, you can deduct it only in the tax year of sale. How to file irs form 1040x Figuring Installment Sale Income Each payment on an installment sale usually consists of the following three parts. How to file irs form 1040x Interest income. How to file irs form 1040x Return of your adjusted basis in the property. How to file irs form 1040x Gain on the sale. How to file irs form 1040x In each year you receive a payment, you must include in income both the interest part and the part that is your gain on the sale. How to file irs form 1040x You do not include in income the part that is the return of your basis in the property. How to file irs form 1040x Basis is the amount of your investment in the property for installment sale purposes. How to file irs form 1040x Interest income. How to file irs form 1040x   You must report interest as ordinary income. How to file irs form 1040x Interest is generally not included in a down payment. How to file irs form 1040x However, you may have to treat part of each later payment as interest, even if it is not called interest in your agreement with the buyer. How to file irs form 1040x Interest provided in the agreement is called stated interest. How to file irs form 1040x If the agreement does not provide for enough stated interest, there may be unstated interest or original issue discount. How to file irs form 1040x See Unstated interest , later. How to file irs form 1040x    You must continue to report the interest income on payments you receive in subsequent years as interest income. How to file irs form 1040x Adjusted basis and installment sale income (gain on sale). How to file irs form 1040x   After you have determined how much of each payment to treat as interest, you treat the rest of each payment as if it were made up of two parts. How to file irs form 1040x A tax-free return of your adjusted basis in the property, and Your gain (referred to as “installment sale income” on Form 6252). How to file irs form 1040x Figuring adjusted basis for installment sale purposes. How to file irs form 1040x   You can use Worksheet 10-1 to figure your adjusted basis in the property for installment sale purposes. How to file irs form 1040x When you have completed the worksheet, you will also have determined the gross profit percentage necessary to figure your installment sale income (gain) for this year. How to file irs form 1040x    Worksheet 10-1. How to file irs form 1040x Figuring Adjusted Basis and Gross Profit Percentage 1. How to file irs form 1040x Enter the selling price for the property   2. How to file irs form 1040x Enter your adjusted basis for the property     3. How to file irs form 1040x Enter your selling expenses     4. How to file irs form 1040x Enter any depreciation recapture     5. How to file irs form 1040x Add lines 2, 3, and 4. How to file irs form 1040x  This is your adjusted basis  for installment sale purposes   6. How to file irs form 1040x Subtract line 5 from line 1. How to file irs form 1040x If zero or less, enter -0-. How to file irs form 1040x  This is your gross profit     If the amount entered on line 6 is zero, Stop here. How to file irs form 1040x You cannot use the installment method. How to file irs form 1040x   7. How to file irs form 1040x Enter the contract price for the property   8. How to file irs form 1040x Divide line 6 by line 7. How to file irs form 1040x This is your gross profit percentage   Selling price. How to file irs form 1040x   The selling price is the total cost of the property to the buyer and includes the following. How to file irs form 1040x Any money you are to receive. How to file irs form 1040x The fair market value (FMV) of any property you are to receive (FMV is discussed at Property used as a payment under Payments Received or Considered Received ). How to file irs form 1040x Any existing mortgage or other debt the buyer pays, assumes, or takes (a note, mortgage, or any other liability, such as a lien, accrued interest, or taxes you owe on the property). How to file irs form 1040x Any of your selling expenses the buyer pays. How to file irs form 1040x Do not include stated interest, unstated interest, any amount recomputed or recharacterized as interest, or original issue discount. How to file irs form 1040x Adjusted basis for installment sale purposes. How to file irs form 1040x   Your adjusted basis is the total of the following three items. How to file irs form 1040x Adjusted basis. How to file irs form 1040x Selling expenses. How to file irs form 1040x Depreciation recapture. How to file irs form 1040x Adjusted basis. How to file irs form 1040x   Basis is your investment in the property for installment sale purposes. How to file irs form 1040x The way you figure basis depends on how you acquire the property. How to file irs form 1040x The basis of property you buy is generally its cost. How to file irs form 1040x The basis of property you inherit, receive as a gift, build yourself, or receive in a tax-free exchange is figured differently. How to file irs form 1040x   While you own property, various events may change your original basis. How to file irs form 1040x Some events, such as adding rooms or making permanent improvements, increase basis. How to file irs form 1040x Others, such as deductible casualty losses or depreciation previously allowed or allowable, decrease basis. How to file irs form 1040x The result is adjusted basis. How to file irs form 1040x See chapter 6 and Publication 551, Basis of Assets, for more information. How to file irs form 1040x Selling expenses. How to file irs form 1040x   Selling expenses relate to the sale of the property. How to file irs form 1040x They include commissions, attorney fees, and any other expenses paid on the sale. How to file irs form 1040x Selling expenses are added to the basis of the sold property. How to file irs form 1040x Depreciation recapture. How to file irs form 1040x   If the property you sold was depreciable property, you may need to recapture part of the gain on the sale as ordinary income. How to file irs form 1040x See Depreciation Recapture in chapter 9 and Depreciation Recapture Income in Publication 537. How to file irs form 1040x Gross profit. How to file irs form 1040x   Gross profit is the total gain you report on the installment method. How to file irs form 1040x   To figure your gross profit, subtract your adjusted basis for installment sale purposes from the selling price. How to file irs form 1040x If the property you sold was your home, subtract from the gross profit any gain you can exclude. How to file irs form 1040x Contract price. How to file irs form 1040x   Contract price equals: The selling price, minus The mortgages, debts, and other liabilities assumed or taken by the buyer, plus The amount by which the mortgages, debts, and other liabilities assumed or taken by the buyer exceed your adjusted basis for installment sale purposes. How to file irs form 1040x Gross profit percentage. How to file irs form 1040x   A certain percentage of each payment (after subtracting interest) is reported as installment sale income. How to file irs form 1040x This percentage is called the gross profit percentage and is figured by dividing your gross profit from the sale by the contract price. How to file irs form 1040x   The gross profit percentage generally remains the same for each payment you receive. How to file irs form 1040x However, see the example under Selling price reduced , later, for a situation where the gross profit percentage changes. How to file irs form 1040x Amount to report as installment sale income. How to file irs form 1040x   Multiply the payments you receive each year (less interest) by the gross profit percentage. How to file irs form 1040x The result is your installment sales income for the tax year. How to file irs form 1040x In certain circumstances, you may be treated as having received a payment, even though you received nothing directly. How to file irs form 1040x A receipt of property or the assumption of a mortgage on the property sold may be treated as a payment. How to file irs form 1040x For a detailed discussion, see Payments Received or Considered Received , later. How to file irs form 1040x Selling price reduced. How to file irs form 1040x   If the selling price is reduced at a later date, the gross profit on the sale also will change. How to file irs form 1040x You then must refigure the gross profit percentage for the remaining payments. How to file irs form 1040x Refigure your gross profit using Worksheet 10-2. How to file irs form 1040x New Gross Profit Percentage — Selling Price Reduced. How to file irs form 1040x You will spread any remaining gain over future installments. How to file irs form 1040x    Worksheet 10-2. How to file irs form 1040x New Gross Profit Percentage — Selling Price Reduced 1. How to file irs form 1040x Enter the reduced selling  price for the property   2. How to file irs form 1040x Enter your adjusted  basis for the  property     3. How to file irs form 1040x Enter your selling  expenses     4. How to file irs form 1040x Enter any depreciation  recapture     5. How to file irs form 1040x Add lines 2, 3, and 4. How to file irs form 1040x   6. How to file irs form 1040x Subtract line 5 from line 1. How to file irs form 1040x  This is your adjusted  gross profit   7. How to file irs form 1040x Enter any installment sale  income reported in  prior year(s)   8. How to file irs form 1040x Subtract line 7 from line 6   9. How to file irs form 1040x Future installments     10. How to file irs form 1040x Divide line 8 by line 9. How to file irs form 1040x  This is your new  gross profit percentage*. How to file irs form 1040x   * Apply this percentage to all future payments to determine how much of each of those payments is installment sale income. How to file irs form 1040x Example. How to file irs form 1040x In 2011, you sold land with a basis of $40,000 for $100,000. How to file irs form 1040x Your gross profit was $60,000. How to file irs form 1040x You received a $20,000 down payment and the buyer's note for $80,000. How to file irs form 1040x The note provides for monthly payments of $1,953 each, figured at 8% interest, amortized over four years, beginning in January 2012. How to file irs form 1040x Your gross profit percentage was 60%. How to file irs form 1040x You received the down payment of $20,000 in 2011 and total payments of $23,436 in 2012, of which $17,675 was principal and $5,761 was interest according to the amortization schedule. How to file irs form 1040x You reported a gain of $12,000 on the down payment received in 2011 and $10,605 ($17,675 X 60% (. How to file irs form 1040x 60)) in 2012. How to file irs form 1040x In January 2013, you and the buyer agreed to reduce the purchase price to $85,000 and payments during 2013, 2014, and 2015 are reduced to $1,483 a month amortized over the remaining three years. How to file irs form 1040x The new gross profit percentage, 47. How to file irs form 1040x 32%, is figured in Example — Worksheet 10-2. How to file irs form 1040x Example — Worksheet 10-2. How to file irs form 1040x New Gross Profit Percentage — Selling Price Reduced 1. How to file irs form 1040x Enter the reduced selling  price for the property 85,000 2. How to file irs form 1040x Enter your adjusted  basis for the  property 40,000   3. How to file irs form 1040x Enter your selling  expenses -0-   4. How to file irs form 1040x Enter any depreciation  recapture -0-   5. How to file irs form 1040x Add lines 2, 3, and 4. How to file irs form 1040x 40,000 6. How to file irs form 1040x Subtract line 5 from line 1. How to file irs form 1040x  This is your adjusted  gross profit 45,000 7. How to file irs form 1040x Enter any installment sale  income reported in  prior year(s) 22,605 8. How to file irs form 1040x Subtract line 7 from line 6 22,395 9. How to file irs form 1040x Future installments   47,325 10. How to file irs form 1040x Divide line 8 by line 9. How to file irs form 1040x  This is your new  gross profit percentage*. How to file irs form 1040x 47. How to file irs form 1040x 32% * Apply this percentage to all future payments to determine how much of each of those payments is installment sale income. How to file irs form 1040x You will report installment sale income of $6,878 (47. How to file irs form 1040x 32% of $14,535) in 2013, $7,449 (47. How to file irs form 1040x 32% of $15,742) in 2014, and $8,067 (47. How to file irs form 1040x 32% of $17,048) in 2015. How to file irs form 1040x Form 6252. How to file irs form 1040x   Use Form 6252 to report an installment sale in the year it takes place and to report payments received, or considered received because of related party resales, in later years. How to file irs form 1040x Attach it to your tax return for each year. How to file irs form 1040x Disposition of Installment Obligation If you are using the installment method and you dispose of the installment obligation, generally you will have a gain or loss to report. How to file irs form 1040x It is considered gain or loss on the sale of the property for which you received the installment obligation. How to file irs form 1040x Cancellation. How to file irs form 1040x   If an installment obligation is canceled or otherwise becomes unenforceable, it is treated as a disposition other than a sale or exchange. How to file irs form 1040x Your gain or loss is the difference between your basis in the obligation and its fair market value (FMV) at the time you cancel it. How to file irs form 1040x If the parties are related, the FMV of the obligation is considered to be no less than its full face value. How to file irs form 1040x Transfer due to death. How to file irs form 1040x   The transfer of an installment obligation (other than to a buyer) as a result of the death of the seller is not a disposition. How to file irs form 1040x Any unreported gain from the installment obligation is not treated as gross income to the decedent. How to file irs form 1040x No income is reported on the decedent's return due to the transfer. How to file irs form 1040x Whoever receives the installment obligation as a result of the seller's death is taxed on the installment payments the same as the seller would have been had the seller lived to receive the payments. How to file irs form 1040x   However, if the installment obligation is canceled, becomes unenforceable, or is transferred to the buyer because of the death of the holder of the obligation, it is a disposition. How to file irs form 1040x The estate must figure its gain or loss on the disposition. How to file irs form 1040x If the holder and the buyer were related, the FMV of the installment obligation is considered to be no less than its full face value. How to file irs form 1040x More information. How to file irs form 1040x   For more information on the disposition of an installment obligation, see Publication 537. How to file irs form 1040x Sale of depreciable property. How to file irs form 1040x   You generally cannot report gain from the sale of depreciable property to a related person on the installment method. How to file irs form 1040x See Sale to a Related Person in Publication 537. How to file irs form 1040x   You cannot use the installment method to report any depreciation recapture income up to the gain on the sale. How to file irs form 1040x However, report any gain greater than the recapture income on the installment method. How to file irs form 1040x   The recapture income reported in the year of sale is included in your installment sale basis to determine your gross profit on the installment sale. How to file irs form 1040x   Figure your depreciation recapture income (including the section 179 deduction and the section 179A deduction recapture) in Part III of Form 4797. How to file irs form 1040x Report the depreciation recapture income in Part II of Form 4797 as ordinary income in the year of sale. How to file irs form 1040x    If you sell depreciable business property, prepare Form 4797 first in order to figure the amount to enter on line 12 of Part I, Form 6252. How to file irs form 1040x See the Form 6252 instructions for details. How to file irs form 1040x   For more information on the section 179 deduction, see Section 179 Expense Deduction in chapter 7. How to file irs form 1040x For more information on depreciation recapture, see Depreciation Recapture in  chapter 9. How to file irs form 1040x Payments Received or Considered Received You must figure your gain each year on the payments you receive, or are treated as receiving, from an installment sale. How to file irs form 1040x In certain situations, you are considered to have received a payment, even though the buyer does not pay you directly. How to file irs form 1040x These situations occur when the buyer assumes or pays any of your debts, such as a loan, or pays any of your expenses, such as a sales commission. How to file irs form 1040x However, as discussed later, the buyer's assumption of your debt is treated as a recovery of basis, rather than as a payment, in many cases. How to file irs form 1040x Buyer pays seller's expenses. How to file irs form 1040x   If the buyer pays any of your expenses related to the sale of your property, it is considered a payment to you in the year of sale. How to file irs form 1040x Include these expenses in the selling and contract prices when figuring the gross profit percentage. How to file irs form 1040x Buyer assumes mortgage. How to file irs form 1040x   If the buyer assumes or pays off your mortgage, or otherwise takes the property subject to the mortgage, the following rules apply. How to file irs form 1040x Mortgage less than basis. How to file irs form 1040x   If the buyer assumes a mortgage that is not more than your installment sale basis in the property, it is not considered a payment to you. How to file irs form 1040x It is considered a recovery of your basis. How to file irs form 1040x The contract price is the selling price minus the mortgage. How to file irs form 1040x Example. How to file irs form 1040x You sell property with an adjusted basis of $19,000. How to file irs form 1040x You have selling expenses of $1,000. How to file irs form 1040x The buyer assumes your existing mortgage of $15,000 and agrees to pay you $10,000 (a cash down payment of $2,000 and $2,000 (plus 8% interest) in each of the next 4 years). How to file irs form 1040x The selling price is $25,000 ($15,000 + $10,000). How to file irs form 1040x Your gross profit is $5,000 ($25,000 − $20,000 installment sale basis). How to file irs form 1040x The contract price is $10,000 ($25,000 − $15,000 mortgage). How to file irs form 1040x Your gross profit percentage is 50% ($5,000 ÷ $10,000). How to file irs form 1040x You report half of each $2,000 payment received as gain from the sale. How to file irs form 1040x You also report all interest you receive as ordinary income. How to file irs form 1040x Mortgage more than basis. How to file irs form 1040x   If the buyer assumes a mortgage that is more than your installment sale basis in the property, you recover your entire basis. How to file irs form 1040x The part of the mortgage greater than your basis is treated as a payment received in the year of sale. How to file irs form 1040x   To figure the contract price, subtract the mortgage from the selling price. How to file irs form 1040x This is the total amount (other than interest) you will receive directly from the buyer. How to file irs form 1040x Add to this amount the payment you are considered to have received (the difference between the mortgage and your installment sale basis). How to file irs form 1040x The contract price is then the same as your gross profit from the sale. How to file irs form 1040x    If the mortgage the buyer assumes is equal to or more than your installment sale basis, the gross profit percentage always will be 100%. How to file irs form 1040x Example. How to file irs form 1040x The selling price for your property is $9,000. How to file irs form 1040x The buyer will pay you $1,000 annually (plus 8% interest) over the next 3 years and assume an existing mortgage of $6,000. How to file irs form 1040x Your adjusted basis in the property is $4,400. How to file irs form 1040x You have selling expenses of $600, for a total installment sale basis of $5,000. How to file irs form 1040x The part of the mortgage that is more than your installment sale basis is $1,000 ($6,000 − $5,000). How to file irs form 1040x This amount is included in the contract price and treated as a payment received in the year of sale. How to file irs form 1040x The contract price is $4,000: Selling price $9,000 Minus: Mortgage (6,000) Amount actually received $3,000 Add difference:   Mortgage $6,000   Minus: Installment sale basis 5,000 1,000 Contract price $4,000   Your gross profit on the sale is also $4,000: Selling price $9,000 Minus: Installment sale basis (5,000) Gross profit $4,000   Your gross profit percentage is 100%. How to file irs form 1040x Report 100% of each payment (less interest) as gain from the sale. How to file irs form 1040x Treat the $1,000 difference between the mortgage and your installment sale basis as a payment and report 100% of it as gain in the year of sale. How to file irs form 1040x Buyer assumes other debts. How to file irs form 1040x   If the buyer assumes any other debts, such as a loan or back taxes, it may be considered a payment to you in the year of sale. How to file irs form 1040x   If the buyer assumes the debt instead of paying it off, only part of it may have to be treated as a payment. How to file irs form 1040x Compare the debt to your installment sale basis in the property being sold. How to file irs form 1040x If the debt is less than your installment sale basis, none of it is treated as a payment. How to file irs form 1040x If it is more, only the difference is treated as a payment. How to file irs form 1040x If the buyer assumes more than one debt, any part of the total that is more than your installment sale basis is considered a payment. How to file irs form 1040x These rules are the same as the rules discussed earlier under Buyer assumes mortgage . How to file irs form 1040x However, they apply only to the following types of debt the buyer assumes. How to file irs form 1040x Those acquired from ownership of the property you are selling, such as a mortgage, lien, overdue interest, or back taxes. How to file irs form 1040x Those acquired in the ordinary course of your business, such as a balance due for inventory you purchased. How to file irs form 1040x   If the buyer assumes any other type of debt, such as a personal loan or your legal fees relating to the sale, it is treated as if the buyer had paid off the debt at the time of the sale. How to file irs form 1040x The value of the assumed debt is then considered a payment to you in the year of sale. How to file irs form 1040x Property used as a payment. How to file irs form 1040x   If you receive property rather than money from the buyer, it is still considered a payment in the year received. How to file irs form 1040x However, see Trading property for like-kind property , later. How to file irs form 1040x Generally, the amount of the payment is the property's FMV on the date you receive it. How to file irs form 1040x Exception. How to file irs form 1040x   If the property the buyer gives you is payable on demand or readily tradable (see examples later), the amount you should consider as payment in the year received is: The FMV of the property on the date you receive it if you use the cash method of accounting, The face amount of the obligation on the date you receive it if you use an accrual method of accounting, or The stated redemption price at maturity less any original issue discount (OID) or, if there is no OID, the stated redemption price at maturity appropriately discounted to reflect total unstated interest. How to file irs form 1040x See Unstated interest , later. How to file irs form 1040x Examples. How to file irs form 1040x If you receive a note from the buyer as payment, and the note stipulates that you can demand payment from the buyer at any time, the note is payable on demand. How to file irs form 1040x If you receive marketable securities from the buyer as payment, and you can sell the securities on an established securities market (such as the New York Stock Exchange) at any time, the securities are readily tradable. How to file irs form 1040x In these examples, use the above rules to determine the amount you should consider as payment in the year received. How to file irs form 1040x Debt not payable on demand. How to file irs form 1040x   Any evidence of debt you receive from the buyer that is not payable on demand is not considered a payment. How to file irs form 1040x This is true even if the debt is guaranteed by a third party, including a government agency. How to file irs form 1040x Fair market value (FMV). How to file irs form 1040x   This is the price at which property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or sell and both having a reasonable knowledge of all the necessary facts. How to file irs form 1040x Third-party note. How to file irs form 1040x   If the property the buyer gives you is a third-party note (or other obligation of a third party), you are considered to have received a payment equal to the note's FMV. How to file irs form 1040x Because the FMV of the note is itself a payment on your installment sale, any payments you later receive from the third party are not considered payments on the sale. How to file irs form 1040x The excess of the note's face value over its FMV is interest. How to file irs form 1040x Exclude this interest in determining the selling price of the property. How to file irs form 1040x However, see Exception under Property used as a payment , earlier. How to file irs form 1040x Example. How to file irs form 1040x You sold real estate in an installment sale. How to file irs form 1040x As part of the down payment, the buyer assigned to you a $50,000, 8% third-party note. How to file irs form 1040x The FMV of the third-party note at the time of the sale was $30,000. How to file irs form 1040x This amount, not $50,000, is a payment to you in the year of sale. How to file irs form 1040x The third-party note had an FMV equal to 60% of its face value ($30,000 ÷ $50,000), so 60% of each principal payment you receive on this note is a nontaxable return of capital. How to file irs form 1040x The remaining 40% is interest taxed as ordinary income. How to file irs form 1040x Bond. How to file irs form 1040x   A bond or other evidence of debt you receive from the buyer that is payable on demand or readily tradable in an established securities market is treated as a payment in the year you receive it. How to file irs form 1040x For more information on the amount you should treat as a payment, see Exception under Property used as a payment , earlier. How to file irs form 1040x   If you receive a government or corporate bond for a sale before October 22, 2004, and the bond has interest coupons attached or can be readily traded in an established securities market, you are considered to have received payment equal to the bond's FMV. How to file irs form 1040x However, see Exception under Property used as a payment , earlier. How to file irs form 1040x Buyer's note. How to file irs form 1040x   The buyer's note (unless payable on demand) is not considered payment on the sale. How to file irs form 1040x However, its full face value is included when figuring the selling price and the contract price. How to file irs form 1040x Payments you receive on the note are used to figure your gain in the year received. How to file irs form 1040x Sale to a related person. How to file irs form 1040x   If you sell depreciable property to a related person and the sale is an installment sale, you may not be able to report the sale using the installment method. How to file irs form 1040x For information on these rules, see the Instructions for Form 6252 and Sale to a Related Person in Publication 537. How to file irs form 1040x Trading property for like-kind property. How to file irs form 1040x   If you trade business or investment property solely for the same kind of property to be held as business or investment property, you can postpone reporting the gain. How to file irs form 1040x See Like-Kind Exchanges in chapter 8 for a discussion of like-kind property. How to file irs form 1040x   If, in addition to like-kind property, you receive an installment obligation in the exchange, the following rules apply to determine installment sale income each year. How to file irs form 1040x The contract price is reduced by the FMV of the like-kind property received in the trade. How to file irs form 1040x The gross profit is reduced by any gain on the trade that can be postponed. How to file irs form 1040x Like-kind property received in the trade is not considered payment on the installment obligation. How to file irs form 1040x Unstated interest. How to file irs form 1040x   An installment sale contract may provide that each deferred payment on the sale will include interest or that there will be an interest payment in addition to the principal payment. How to file irs form 1040x Interest provided in the contract is called stated interest. How to file irs form 1040x   If an installment sale contract does not provide for adequate stated interest, part of the stated principal amount of the contract may be recharacterized as interest. How to file irs form 1040x If Internal Revenue Code section 483 applies to the contract, this interest is called unstated interest. How to file irs form 1040x   If Internal Revenue Code section 1274 applies to the contract, this interest is called original issue discount (OID). How to file irs form 1040x   Generally, if a buyer gives a debt in consideration for personal use property, the unstated interest rules do not apply. How to file irs form 1040x Therefore, the buyer cannot deduct the unstated interest. How to file irs form 1040x The seller must report the unstated interest as income. How to file irs form 1040x Personal-use property is any property in which substantially all of its use by the buyer is not in connection with a trade or business or an investment activity. How to file irs form 1040x   If the debt is subject to the Internal Revenue Code section 483 rules and is also subject to the below-market loan rules, such as a gift loan, compensation-related loan or corporation-shareholder loan, then both parties are subject to the below-market loan rules rather than the unstated interest rules. How to file irs form 1040x   Unstated interest reduces the stated selling price of the property and the buyer's basis in the property. How to file irs form 1040x It increases the seller's interest income and the buyer's interest expense. How to file irs form 1040x   In general, an installment sale contract provides for adequate stated interest if the stated interest rate (based on an appropriate compounding period) is at least equal to the applicable federal rate (AFR). How to file irs form 1040x    The AFRs are published monthly in the Internal Revenue Bulletin (IRB). How to file irs form 1040x You can get this information by contacting an IRS office. How to file irs form 1040x IRBs are also available at IRS. How to file irs form 1040x gov. How to file irs form 1040x More information. How to file irs form 1040x   For more information, see Unstated Interest and Original Issue Discount (OID) in Publication 537. How to file irs form 1040x Example. How to file irs form 1040x You sell property at a contract price of $6,000 and your gross profit is $1,500. How to file irs form 1040x Your gross profit percentage is 25% ($1,500 ÷ $6,000). How to file irs form 1040x After subtracting interest, you report 25% of each payment, including the down payment, as installment sale income from the sale for the tax year you receive the payment. How to file irs form 1040x The remainder (balance) of each payment is the tax-free return of your adjusted basis. How to file irs form 1040x Example On January 3, 2013, you sold your farm, including the home, farm land and buildings. How to file irs form 1040x You received $50,000 down and the buyer's note for $200,000. How to file irs form 1040x In addition, the buyer assumed an outstanding $50,000 mortgage on the farm land. How to file irs form 1040x The total selling price was $300,000. How to file irs form 1040x The note payments of $25,000 each, plus adequate interest, are due every July 1 and January 1, beginning in July 2013. How to file irs form 1040x Your selling expenses were $15,000. How to file irs form 1040x Adjusted basis and depreciation. How to file irs form 1040x   The adjusted basis and depreciation claimed on each asset sold are as follows:   Depreciation Adjusted Asset Claimed Basis Home* -0- $33,743 Farm land -0- 73,610 Buildings $31,500 35,130 * Owned and used as main home for at least 2 of the 5 years prior to the sale Gain on each asset. How to file irs form 1040x   The following schedule shows the assets included in the sale, each asset's selling price based on its respective value, the selling expense allocated to each asset, the adjusted basis of each asset, and the gain on each asset. How to file irs form 1040x The selling expense for each asset is 5% of the selling price ($15,000 selling expense ÷ $300,000 selling price). How to file irs form 1040x   Selling Selling Adjusted     Price Expense Basis Gain Home* $60,000 $3,000 $33,743 $23,257 Farm land  165,000  8,250  73,610  83,140 Buildings 75,000 3,750 35,130 36,120   $300,000 $15,000 $142,483 $142,517 * Owned and used as main home for at least 2 of the 5 years prior to the sale Depreciation recapture. How to file irs form 1040x   The buildings are section 1250 property. How to file irs form 1040x There is no depreciation recapture income for them because they were depreciated using the straight line method. How to file irs form 1040x See chapter 9 for more information on depreciation recapture. How to file irs form 1040x   Special rules may apply when you sell section 1250 assets depreciated under the straight line method. How to file irs form 1040x See the Unrecaptured Section 1250 Gain Worksheet in the Instructions for Schedule D (Form 1040). How to file irs form 1040x See chapter 3 of Publication 544, Sales and Other Dispositions of Assets, for more information on section 1250 assets. How to file irs form 1040x Installment sale basis and gross profit. How to file irs form 1040x   The following table shows each asset reported on the installment method, its selling price, installment sale basis, and gross profit. How to file irs form 1040x     Installment     Selling Sale Gross   Price Basis Profit Farm land $165,000 $73,610 $83,140 Buildings 75,000 35,130 36,120   $240,000 $108,740 $119,260 Section 1231 gains. How to file irs form 1040x   The gain on the farm land and buildings is reported as section 1231 gains. How to file irs form 1040x See Section 1231 Gains and Losses in chapter 9. How to file irs form 1040x Contract price and gross profit percentage. How to file irs form 1040x   The contract price is $250,000 for the part of the sale reported on the installment method. How to file irs form 1040x This is the selling price ($300,000) minus the mortgage assumed ($50,000). How to file irs form 1040x   Gross profit percentage for the sale is 47. How to file irs form 1040x 70% ($119,260 gross profit ÷ $250,000 contract price). How to file irs form 1040x The gross profit percentage for each asset is figured as follows:   Percent Farm land ($83,140 ÷ $250,000) 33. How to file irs form 1040x 256 Buildings ($36,120 ÷ $250,000) 14. How to file irs form 1040x 448 Total 47. How to file irs form 1040x 70 Figuring the gain to report on the installment method. How to file irs form 1040x   One hundred percent (100%) of each payment is reported on the installment method. How to file irs form 1040x The total amount received on the sale in 2013 is $75,000 ($50,000 down payment + $25,000 payment on July 1). How to file irs form 1040x The installment sale part of the total payments received in 2013 is also $75,000. How to file irs form 1040x Figure the gain to report for each asset by multiplying its gross profit percentage times $75,000. How to file irs form 1040x   Income Farm land—33. How to file irs form 1040x 256% × $75,000 $24,942 Buildings—14. How to file irs form 1040x 448% × $75,000 10,836 Total installment income for 2013 $35,778 Reporting the sale. How to file irs form 1040x   Report the installment sale on Form 6252. How to file irs form 1040x Then report the amounts from Form 6252 on Form 4797 and Schedule D (Form 1040). How to file irs form 1040x Attach a separate page to Form 6252 that shows the computations in the example. How to file irs form 1040x If you sell depreciable business property, prepare Form 4797 first in order to figure the amount to enter on line 12 of Part I, Form 6252. How to file irs form 1040x Section 1231 gains. How to file irs form 1040x   The gains on the farm land and buildings are section 1231 gains. How to file irs form 1040x They may be reported as either capital or ordinary gain depending on the net balance when combined with other section 1231 losses. How to file irs form 1040x A net 1231 gain is capital gain and a net 1231 loss is an ordinary loss. How to file irs form 1040x Installment income for years after 2013. How to file irs form 1040x   You figure installment income for the years after 2013 by applying the same gross profit percentages to the payments you receive each year. How to file irs form 1040x If you receive $50,000 during the year, the entire $50,000 is considered received on the installment sale (100% × $50,000). How to file irs form 1040x You realize income as follows:   Income Farm land—33. How to file irs form 1040x 256% × $50,000 $16,628 Buildings—14. How to file irs form 1040x 448% × $50,000 7,224 Total installment income $23,852   In this example, no gain ever is recognized from the sale of your home. How to file irs form 1040x You will combine your section 1231 gains from this sale with section 1231 gains and losses from other sales in each of the later years to determine whether to report them as ordinary or capital gains. How to file irs form 1040x The interest received with each payment will be included in full as ordinary income. How to file irs form 1040x Summary. How to file irs form 1040x   The installment income (rounded to the nearest dollar) from the sale of the farm is reported as follows: Selling price $190,000 Minus: Installment basis (108,740) Gross profit $81,260     Gain reported in 2012 (year of sale) $35,778 Gain reported in 2013:   $50,000 × 47. How to file irs form 1040x 70% 23,850 Gain reported in 2014:   $50,000 × 47. How to file irs form 1040x 70% 23,850 Gain reported in 2015:   $50,000 × 47. How to file irs form 1040x 70% 23,850 Gain reported in 2016:   $25,000 × 47. How to file irs form 1040x 70% 11,925 Total gain reported $119,253 Prev  Up  Next   Home   More Online Publications
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Social Media Registry API Documentation

About the API

This documentation describes methods to use the Social Media Registry API to access the contents of the Social Media Registry.

The Social Media Registry is an official source of information about social media accounts that represent official U.S. federal government agencies, elected officials, or members of the President’s Cabinet.

If you work for the federal government and have a .gov or .mil e-mail address, you can register official U.S. federal accounts at HowTo.gov.

If you have feedback, questions, or want to tell us about the product you built with the Social Media Registry API, please e-mail us.

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Accessing the API

The interface described here uses the same method URLs and parameters for all response formats, including HTML5, JSON, and XML. If no response format is specified at request time, the results are returned as HTML5 (with the assumption that a user is accessing the API via a web browser). To specify alternate formats, append the result format to the method call:

http://registry.usa.gov/accounts?agency_id=usda
http://registry.usa.gov/accounts.json?agency_id=usda
http://registry.usa.gov/accounts.xml?agency_id=usda

API requests can be called from remote sites via Javascript using the Cross-Origin Resource Sharing mechanism (CORS) supported in most browsers. All published API methods may be called from any domain.

If support for older browsers is required, JSON requests can be made with a callback parameter in order to return JSONP responses:

http://registry.usa.gov/accounts.json?agency_id=usda&callback=listaccounts

API Updates Using Feeds

Some API methods are also available as feeds in the ATOM format. These feeds can be added to any news feed reader to list recent changes.

The ATOM format is an XML feed standard; each entry contains a summary of the Registry change and a link to the Registry API to view more information.

Feed Examples

List the most recently updated official Twitter accounts: http://registry.usa.gov/accounts.atom?service_id=twitter

List the most recently updated official accounts from the U.S. Department of Agriculture: http://registry.usa.gov/accounts.atom?agency_id=usda

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API Methods

/accounts (GET)

List official U.S. government social media accounts entries in the registry. This method is also available as an ATOM feed.

Parameters

  • agency_id: ID (from /agencies)
  • service_id: ID (from /services)
  • tag: text
  • page_size: integer
  • page_number: integer

Output

  • page_count: integer
  • page_number: integer
  • total_items: integer

Accounts

  • service_url: text
  • verified : boolean
  • service_id: ID
  • account: text
  • details_url: text
  • organization: text
  • agencies
    • agency_id: text
    • agency_name: text
    • agency_url: text

Example Calls

List all official accounts from the U.S. Department of Agriculture: http://registry.usa.gov/accounts?agency_id=usda

List all official Twitter accounts from the U.S. Department of Health and Human Services:
http://registry.usa.gov/accounts?service=twitter&agency_id=hhs

/accounts/{service ID} (GET)

A synonym for /accounts?service_id={service}, provided for REST-style browsing.

/accounts/{service ID}/{account} (GET)

A synonym for the /accounts/verify method, using a canonical service and account ID provided by that method. For example, the service and account ID for http://twitter.com/JPL_Bear might be twitter/JPL_Bear, making the canonical URL take the form http://registry.usa.gov/accounts/twitter/JPL_Bear

This is provided primarily for REST-style browsing.

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/accounts/verify (GET)

Check whether the provided URL is registered as an official government social media account.

Example: /accounts/verify?service_url=https%3A%2F%2Ftwitter.com%2F%23%21%2FJPL_Bear

Parameters

  • service_url: URL (required)

Output

  • verified: boolean
  • service_url: URL
  • service_id: ID (from /services list)
  • account: text

(if verified is true:)

  • details_url: URL
  • organization: text
  • info_url: text
  • agencies
    • agency_id: text
    • agency_name: text
    • agency_url: text
  • tags: list
  • language: text
  • display_name: text
  • updated_by: text
  • updated_at: ISO 8601 date

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/agencies (GET) 

List the sponsoring agencies that may be specified in the /accounts/add method.

Parameters

  • none

Output

  • page_count: integer
  • total_items: integer
  • page_number: integer
  • agencies: list
    • agency_id: text
    • agency_name: text
    • agency_url: text

/services (GET)

List the social media services that are currently supported in the /accounts/add method.

Parameters

  • none

Output

  • page_count: integer
  • total_items: integer
  • page_number: integer
  • services: list
    • service_id: text
    • service_name: text

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/tags (GET) 

List tags that are suggested for describing an account.

Parameters

  • keywords: text

Output

  • tags: list
  • tag_id: text
  • tag_text: text

Source Code

The code for the Social Media Registry is open source and available on GitHub. It is written in Ruby.

Example Applications

Terms of Service

By using this data, you agree to the Terms of Service.

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The How To File Irs Form 1040x

How to file irs form 1040x 16. How to file irs form 1040x   Rulings Program The IRS has a program for assisting taxpayers who have technical problems with tax laws and regulations. How to file irs form 1040x The IRS will answer inquiries from individuals and organizations about the tax effect of their acts or transactions. How to file irs form 1040x The National Office of the IRS issues rulings on those matters. How to file irs form 1040x A ruling is a written statement to a taxpayer that interprets and applies tax laws to the taxpayer's specific set of facts. How to file irs form 1040x There are also determination letters issued by IRS directors and information letters issued by IRS directors or the National Office. How to file irs form 1040x There is a fee for most types of determination letters and rulings. How to file irs form 1040x For complete information on the rulings program, see the first Internal Revenue Bulletin published each year. How to file irs form 1040x Prev  Up  Next   Home   More Online Publications