1099-INT Interest Income
This is archived information that pertains only to the 2002 Tax Year. If you
are looking for information for the current tax year, go to the Tax Prep Help Area.
How do I report interest received on an installment sale?
If you receive interest on an installment sale, report the entire amount on line 8a of Form 1040 (PDF) or Form 1040A (PDF), or line 2 of Form 1040EZ (PDF). If your taxable interest income is more than $1,500, be sure to show that income on Schedule B of Form 1040, or on Schedule 1 of Form 1040A. You cannot file Form 1040EZ if your interest income is more than $1,500. Refer to Tax Topic 403, Interest Received, for additional information on interest income Form 1040, Schedule B (PDF). For additional information on installment sales, refer to Tax Topic 705, or Publication 537 (PDF), Installment Sales.
References: 11.4 Sale or Trade of Business, Depreciation, Rentals: Sales, Trades, Exchanges How do I file the gain on an installment sale of business property in each year? What form do I use?
Use Form 6252 (PDF), Installment Sale Income, to figure your installment sale income each year. This form does not account for taxable interest income from the sale that needs to be reported each year by the seller, usually on Form 1040, Schedule B (PDF), Interest and Ordinary Dividends.
You may also need Form 1040, Schedule D (PDF), Capital Gains and Losses, and Form 4797 (PDF), Sales of Business Property. For additional information including forms and instructions, refer to Publication 537 (PDF), Installment Sales
References:
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