Wendy Sold Property on the Installment Basis in 2012 for More

Wendy sold property on the installment basis in 2012 for more than her basis in the property. Wendy was to receive installment payments at the end of each year for the next five years. In 2014, Wendy was killed in a car accident and the note was transferred to her estate.

A) The estate must recognize the gain from all the amounts collected on the installment obligation in 2014.
B) The income will be reported on Wendy's 2014 income tax return as income in respect of a decedent.
C) The entire gain must be recognized in 2012.
D) Gain is recognized by Wendy and reported on her 2014 income tax return when the note is transferred into the estate.
E) None of the above.