This year Henry realized a gain on the sale of an antique car that he inherited from his uncle.The buyer has promised to pay Henry in installment payments over the next few years.Identify the principle that will determine when Henry should be taxed on the gain from the sale:

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The "wherewithal to pay" principle suggests that taxpayers should be taxed when they have the means to pay the tax. Since Henry is receiving installment payments, he will be taxed on the gain as he receives the payments, aligning with his ability to pay the tax.

This Year Henry Realized a Gain on the Sale of an Antique