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    ariannen's Avatar
    ariannen Posts: 1, Reputation: 1
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    #1

    Oct 29, 2011, 08:37 AM
    Land contract sale
    I am thinking of selling my house on land contract. I was wondering what the difference in tax paid on profit would be if any compared to an outright sale. Thanks for your advice
    ebaines's Avatar
    ebaines Posts: 12,131, Reputation: 1307
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    Oct 31, 2011, 01:07 PM
    In general there isn't much difference in what you report as a gain. In an installment sale such as this you report the sale as if the buyer has paid up front in full, even though they will be paying you over a number of years. It can get a little complicated if in a year or two the buyer defaults and you repossess, as you will then need to report a loss. The other major difference is you will need to report the interest that you receive from the buyer as income on Schedule B. You can get more details from here:
    Publication 537 (2010), Installment Sales
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