Taylor sold a capital asset on the installment basis and did not charge interest on the deferred payment due in three years.
A) Interest will be imputed, thus increasing the total gross income from the transactions.
B) Interest will be imputed, thus decreasing the capital gain.
C) Interest will not be imputed because the contract is for less than five years.
D) Interest will be imputed, thus increasing the buyer's basis in the asset.
E) None of the above.

Question

Quizplus · Accepted Answer

The Answer of Taylor sold a capital asset on the installment basis and did not charge interest on the deferred payment due in three years.
A) Interest will be imputed, thus increasing the total gross income from the transactions.
B) Interest will be imputed, thus decreasing the capital gain.
C) Interest will not be imputed because the contract is for less than five years.
D) Interest will be imputed, thus increasing the buyer's basis in the asset.
E) None of the above.

Taylor Sold a Capital Asset on the Installment Basis and Did