All of the following taxpayers can use the installment method to report gains from the sale of assets except:

Question

Quizplus · Accepted Answer

A taxpayer who took a Section 179 deduction for the total cost of an asset when it was purchased is not eligible for the installment method. This is because the deduction allowed the taxpayer to immediately write off the cost of the asset, and therefore, the entire gain must be recognized in the year of sale.

The other choices are eligible for the installment method because they did not take a Section 179 deduction for the assets sold, and the assets are not excluded from installment reporting under other rules.

All of the Following Taxpayers Can Use the Installment Method