Form 6252

Department of the Treasury 

Internal Revenue Service

Installment Sale Income

Attach to your tax return. 

Use a separate form for each sale or other disposition of property on the installment method. 

Go to www.irs.gov/Form6252 for the latest information.

OMB No. 1545-0228

2023

Attachment 

Sequence No. 67

Name(s) shown on return Identifying number

1 Description of property 

2 a Date acquired (mm/dd/yyyy) b Date sold (mm/dd/yyyy) 

3 Was the property sold to a related party? See instructions. If “Yes,” complete Part III for the year of sale and 2

years after the year of the sale unless you received the final payment during the tax year . . . . . . . Yes No

4 Reserved for future use . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Yes No

Part I Gross Profit and Contract Price. Complete this part for all years of the installment agreement. 

5 Selling price including mortgages and other debts. Don’t include interest, whether stated or unstated 5 

6 Mortgages, debts, and other liabilities the buyer assumed or took the property 

subject to (see instructions) . . . . . . . . . . . . . . . . . 6 

7 Subtract line 6 from line 5 . . . . . . . . . . . . . . . . . 7 

8 Cost or other basis of property sold . . . . . . . . . . . . . . 8 

9 Depreciation allowed or allowable . . . . . . . . . . . . . . . 9 

10 Adjusted basis. Subtract line 9 from line 8 . . . . . . . . . . . . 10 

11 Commissions and other expenses of sale . . . . . . . . . . . . 11 

12 Income recapture from Form 4797, Part III (see instructions) . . . . . . 12 

13 Add lines 10, 11, and 12 . . . . . . . . . . . . . . . . . . . . . . . . . . 13 

14 Subtract line 13 from line 5. If zero or less, don’t complete the rest of this form. See instructions . . 14 

15 If the property described on line 1 above was your main home, enter the amount of your excluded 

gain. See instructions. Otherwise, enter -0- . . . . . . . . . . . . . . . . . . . . 15 

16 Gross profit. Subtract line 15 from line 14 . . . . . . . . . . . . . . . . . . . . 16 

17 Subtract line 13 from line 6. If zero or less, enter -0- . . . . . . . . . . . . . . . . . 17 

18 Contract price. Add line 7 and line 17 . . . . . . . . . . . . . . . . . . . . . 18 

Part II Installment Sale Income. Complete this part for all years of the installment agreement. 

19 Gross profit percentage (expressed as a decimal amount). Divide line 16 by line 18. (For years after 

the year of sale, see instructions.) . . . . . . . . . . . . . . . . . . . . . . . 19 

20 If this is the year of sale, enter the amount from line 17. Otherwise, enter -0- . . . . . . . . . 20 

21 Payments received during year (see instructions). Don’t include interest, whether stated or unstated . 21 

22 Add lines 20 and 21 . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 

23 Payments received in prior years (see instructions). Don’t include interest, 

whether stated or unstated . . . . . . . . . . . . . . . . . 23 

24 Installment sale income. Multiply line 22 by line 19 . . . . . . . . . . . . . . . . . 24 

25 Enter the part of line 24 that is ordinary income under the recapture rules. See instructions . . . . 25 

26 Subtract line 25 from line 24. Enter here and on Schedule D or Form 4797. See instructions . . . 26 

Part III Related Party Installment Sale Income. Don’t complete if you received the final payment this tax year.

27 Name, address, and taxpayer identifying number of related party

28 Did the related party resell or dispose of the property (“second disposition”) during this tax year? . . . . . Yes No

29 If the answer to question 28 is “Yes,” complete lines 30 through 37 below unless one of the following conditions is met. 

Check the box that applies.

a The second disposition was more than 2 years after the first disposition (other than dispositions of marketable securities). If

this box is checked, enter the date of disposition (mm/dd/yyyy) . . . . . . . . . . . . .

b The first disposition was a sale or exchange of stock to the issuing corporation.

c The second disposition was an involuntary conversion and the threat of conversion occurred after the first disposition.

d The second disposition occurred after the death of the original seller or buyer.

e It can be established to the satisfaction of the IRS that tax avoidance wasn’t a principal purpose for either of the dispositions. 

If this box is checked, attach an explanation. See instructions.

30 Selling price of property sold by related party (see instructions) . . . . . . . . . . . . . 30 

31 Enter contract price from line 18 for year of first sale . . . . . . . . . . . . . . . . 31

 32 Enter the smaller of line 30 or line 31 . . . . . . . . . . . . . . . . . . . . . 32

 33 Total payments received by the end of your 2023 tax year (see instructions) . . . . . . . . . 33

 34 Subtract line 33 from line 32. If zero or less, enter -0- . . . . . . . . . . . . . . . . 34

 35 Multiply line 34 by the gross profit percentage on line 19 for year of first sale . . . . . . . . 35

 36 Enter the part of line 35 that is ordinary income under the recapture rules. See instructions . . . . 36

 37 Subtract line 36 from line 35. Enter here and on Schedule D or Form 4797. See instructions . . . 37

For Paperwork Reduction Act Notice, see page 4. Cat. No. 13601R Form 6252 (2023)
Form 6252 (2023) Page 2

General Instructions

Section references are to the Internal Revenue 

Code unless otherwise noted.

Future Developments

For the latest information about developments 

related to Form 6252 and its instructions, 

such as legislation enacted after they were 

published, go to www.irs.gov/Form6252.

What’s New

Installment sale reporting. In 2023 and later, 

if you have an outstanding installment sale 

balance after the initial year, complete lines 1 

through 4, Part I, and Part II for each year of 

the installment agreement. If you sold 

property to a related party during the year, 

also complete Part III for the year of sale and 

2 years after the year of the sale unless you 

received the final payment during the tax year.

Qualified Opportunity Investment. If you 

held a qualified investment in a qualified 

opportunity fund (QOF) at any time during the 

year, you must file your return with Form 

8997, Initial and Annual Statement of Qualified 

Opportunity Fund (QOF) Investments, 

attached. See the Form 8997 instructions.

Purpose of Form

Use Form 6252 to report income from an 

installment sale on the installment method. 

Generally, an installment sale is a disposition 

of property where at least one payment is 

received after the end of the tax year in which 

the disposition occurs. Ordinarily, an 

installment sale doesn’t include a disposition 

of personal property by a person who 

regularly sells or otherwise disposes of 

personal property of the same type, or a 

disposition of real property that is held by the 

taxpayer for sale to customers in the ordinary 

course of the taxpayer’s trade or business. 

However, gain on some dispositions by 

dealers in real property or farmers who 

dispose of any property used or produced in 

the trade or business of farming may be 

reported on the installment method.

Don’t file Form 6252 for sales that don’t 

result in a gain, even if you will receive a 

payment in a tax year after the year of sale. 

Instead, report the entire sale on Form 4797, 

Sales of Business Property; Form 8949, Sales 

and Other Dispositions of Capital Assets; or 

the Schedule D for your tax return, whichever 

applies.

Don’t file Form 6252 to report sales during 

the tax year of stock or securities traded on 

an established securities market. Instead, 

treat all payments as received during the year 

of sale.

Don’t file Form 6252 if you elect not to 

report the sale on the installment method. To 

elect out, report the full amount of the gain on 

a timely filed return (including extensions) on 

Form 4797, Form 8949, or the Schedule D for 

your tax return, whichever applies. If you filed 

your original return on time without making 

the election, you can make the election on an 

amended return filed no later than 6 months 

after the due date of your tax return, 

excluding extensions. Enter “Filed pursuant to 

section 301.9100-2” at the top of the 

amended return.

Which Parts To Complete

For All Years

Complete lines 1 through 4, Part I, and Part II. 

Complete these requirements for Form 6252 

for each year of the installment agreement, 

including the year of final payment, even if a 

payment wasn’t received during the year.

Note: If the property was sold to a related 

party, also complete Part III for the year of 

sale and 2 years after the year of sale unless 

you received the final payment during the tax 

year.

Special Rules

Interest

If any part of an installment payment you 

received is for interest or original issue 

discount, report that income on the 

appropriate form or schedule for the tax year 

the interest or original issue discount is 

includible in your income. Don’t report interest 

received, carrying charges received, original 

issue discount, or unstated interest on Form 

6252. See Pub. 537, Installment Sales, for 

details on unstated interest and original issue 

discount.

Installment Sales to Related Party

A special rule applies to a first disposition 

(sale or exchange) of property under the 

installment method to a related party who 

then makes a second disposition (sale, 

exchange, gift, or cancellation of installment 

note) before making all payments on the first 

disposition. For this purpose, a related party 

includes your spouse, child, grandchild, 

parent, or sibling; or a related corporation, S 

corporation, partnership, estate, or trust. See 

section 453(f)(1) for more details.

Under this rule, treat part or all of the 

amount the related party realized (or the fair 

market value (FMV) if the disposed property 

isn’t sold or exchanged) from the second 

disposition as if you received it from the first 

disposition at the time of the second 

disposition. Figure the gain, if any, on lines 30 

through 37. This rule doesn’t apply if any of 

the conditions listed on line 29 are met.

Sale of Depreciable Property to 

Related Person

Generally, if you sell depreciable property to a 

related person (as defined in section 

453(g)(3)), you can’t report the sale using the 

installment method. For this purpose, 

depreciable property is any property that (in 

the hands of the person or entity to whom you 

transfer it) is subject to the allowance for 

depreciation. However, you can use the 

installment method if you can show to the 

satisfaction of the IRS that avoidance of 

federal income taxes wasn’t one of the 

principal purposes of the sale (for example, no 

significant tax deferral benefits will result from 

the sale). If the installment method doesn’t 

apply, report the sale on Form 4797, Form 

8949, or Schedule D, whichever applies. Treat 

all payments you will receive as if they were 

received in the year of sale. Use FMV for any 

payment that is contingent as to amount. If 

the FMV can’t be readily determined, basis is 

recovered ratably.

Pledge Rule

For certain dispositions under the installment 

method, if an installment obligation is pledged 

as security on a debt, the net proceeds of the 

secured debt are treated as payment on the 

installment obligation. However, the amount 

treated as payment can’t be more than the 

excess of the total installment contract price 

over any payments received under the 

contract before the secured debt was 

obtained.

An installment obligation is pledged as 

security on a debt to the extent that payment 

of principal and interest on the debt is directly 

secured by an interest in the installment 

obligation. For sales after December 16, 1999, 

payment on a debt is treated as directly 

secured by an interest in an installment 

obligation to the extent an arrangement 

allows you to satisfy all or part of the debt 

with the installment obligation.

The pledge rule applies to any installment 

sale after 1988 with a sales price of over 

$150,000 except:

• Personal-use property disposed of by an 

individual,

• Farm property, and

• Timeshares and residential lots.

However, the pledge rule doesn’t apply to 

pledges made after December 17, 1987, if the 

debt is incurred to refinance the principal 

amount of a debt that was outstanding on 

December 17, 1987, and was secured by 

nondealer installment obligations on that date 

and at all times after that date until the 

refinancing. This exception doesn’t apply to 

the extent that the principal amount of the 

debt resulting from the refinancing exceeds 

the principal amount of the refinanced debt 

immediately before the refinancing. Also, the 

pledge rule doesn’t affect refinancing due to 

the calling of a debt by the creditor if the debt 

is then refinanced by a person other than this 

creditor or someone related to the creditor.

Interest on Deferred Tax

Generally, you must pay interest on the 

deferred tax related to any obligation, 

including contingent obligations, that arises 

during a tax year from the disposition of 

property under the installment method if:

• The property had a sales price over 

$150,000; and

• The aggregate balance of all nondealer 

installment obligations arising during, and 

outstanding at the close of, the tax year is 

more than $5 million.

You must pay interest in subsequent years 

if installment obligations, including contingent 

obligations, that originally required interest to 

be paid are still outstanding at the close of a 

tax year.

The interest rules don’t apply to 

dispositions of:

• Farm property,

• Personal-use property by an individual,

• Real property before 1988, or

• Personal property before 1989.
Form 6252 (2023) Page 3

See section 453(l) for more information on 

the sale of timeshares and residential lots 

under the installment method.

How to report the interest. The interest isn’t 

figured on Form 6252. See Pub. 537 for 

details and an example on how to report the 

interest under section 453A.

Capital Gains

If you have a capital gain, you can invest that 

gain into a QOF and elect to defer part or all 

of the gain that you would otherwise include 

in income. The gain is deferred until you sell 

or exchange the investment, you experience 

an inclusion event with respect to the 

investment, or December 31, 2026, whichever 

is earlier. You may also be able to 

permanently exclude gain from the sale or 

exchange of an investment in a QOF if the 

investment is held for at least 10 years. For 

information about what types of gains entitle 

you to elect these special rules, see the 

Instructions for Schedule D (Form 1040). 

Report the eligible gain on the form and in the 

manner otherwise instructed. See the Form 

8949 instructions on how to report your 

election to defer eligible gains invested in a 

QOF. If you held a qualified investment in a 

QOF at any time during the year, you must file 

your return with Form 8997 attached. See the 

Form 8997 instructions.

Additional Information

See Pub. 537 for additional information, 

including details about reductions in selling 

price, the single sale of several assets, likekind exchanges, dispositions of installment 

obligations, and repossessions.

Specific Instructions

Part I—Gross Profit and Contract 

Price

Line 1

Enter a code from the list below and 

describe the installment sale property.

Code:

1. Sale property is timeshare or residential 

lot.

2. Sale by an individual of personal-use 

property (within the meaning of section 

1275(b)(3)). 

3. Sale of any property used or produced in 

the trade or business of farming (within 

the meaning of section 2032A(e)(4) or (5)).

4. All other installment sales not listed.

Line 5

Enter the total of any money, the face amount 

of the installment obligation, and the FMV of 

other property or services that you received or 

will receive in exchange for the property sold. 

Include on line 5 any existing mortgage or 

other debt the buyer assumed or took the 

property subject to. Don’t include stated 

interest, unstated interest, any amount 

recomputed or recharacterized as interest, or 

original issue discount.

If there is a contingent payment sale with a 

stated maximum selling price, the stated 

maximum sales price should be reported on 

line 5. The term “contingent payment sale” 

means a sale or other disposition of property 

in which the aggregate selling price cannot be 

determined by the close of the tax year in 

which such sale or other disposition occurs. 

See Temporary Regulations section 

15a.453-1(c). If there is no stated maximum 

selling price, attach a schedule showing the 

computation of gain. Enter the taxable part of 

the payment on line 24 and also on line 35 if 

Part III applies. See Temporary Regulations 

section 15a.453-1.

Line 6

Enter only mortgages, debts, or other 

liabilities the buyer assumed from the seller or 

took the property subject to. Don’t include 

new mortgages the buyer gets from a bank, 

the seller, or other sources.

Line 8

Enter the original cost and other expenses 

you incurred in buying the property. Add the 

cost of improvements, etc., and subtract any 

casualty losses and any of the following 

credits previously allowed with respect to the 

property. 

• Nonbusiness energy property credit.

• Residential energy efficient property credit.

• Adoption credit.

• District of Columbia first-time homebuyer 

credit.

• Disabled access credit.

• New markets credit.

• Credit for employer-provided childcare 

facilities and services.

• Energy efficient home credit.

• Alternative motor vehicle credit.

• Alternative fuel vehicle refueling property 

credit.

• Qualified railroad track maintenance credit.

• Enhanced oil recovery credit.

• Qualified plug-in electric drive motor vehicle 

credit. 

• Qualified plug-in electric vehicle credit.

• Qualified electric vehicle credit.

For additional information, see Pub. 551, 

Basis of Assets.

Line 9

Enter all depreciation or amortization you 

deducted or were allowed to deduct from the 

date of purchase until the date of sale. Adjust 

the depreciation or amortization amount by 

adding any of the following deductions 

previously taken with respect to the property.

• Commercial revitalization deduction.

• Section 179 expense.

• Deduction for clean-fuel vehicles and 

refueling property.

• Deductions claimed under sections 190 and 

193.

• Deductions claimed under section 

1253(d)(2) and (3) (as in effect before 

enactment of P.L. 103-66).

• Basis reduction to investment credit 

property.

Subtract the following recapture amounts 

and credits previously allowed with respect to 

the property. 

• Section 179 or 280F.

• Clean-fuel vehicles and refueling property.

• Investment credit amount.

• Credit for employer-provided childcare 

facilities and services.

• Alternative motor vehicle credit.

• Alternative fuel vehicle refueling property 

credit.

• Qualified plug-in electric drive motor vehicle 

credit.

• Qualified plug-in electric vehicle credit.

• Qualified electric vehicle credit.

Line 11

Enter sales commissions, advertising 

expenses, attorney and legal fees, and other 

selling expenses incurred to sell the property.

Line 12

Any ordinary income recapture under section 

1245 or 1250 (including sections 179 and 291) 

is fully taxable in the year of sale even if no 

payments were received. To figure the 

recapture amount, complete Form 4797, Part 

III. The ordinary income recapture is the 

amount on line 31 of Form 4797. Enter it on 

line 12 of Form 6252 and also on line 13 of 

Form 4797. Don’t enter any gain for this 

property on line 32 of Form 4797. If you used 

Form 4797 only to figure the recapture 

amount on line 12 of Form 6252, enter “N/A” 

on line 32 of Form 4797. Partnerships and S 

corporations and their partners and 

shareholders, see the Instructions for Form 

4797.

Line 14

Don’t file Form 6252 if line 14 is zero or less. 

Instead, report the entire sale on Form 4797, 

Form 8949, or the Schedule D for your tax 

return.
Form 6252 (2023) Page 4

Line 15

If the property described on line 1 was your 

main home, you may be able to exclude part 

or all of your gain. See Pub. 523, Selling Your 

Home, for details.

Part II—Installment Sale 

Income

Line 19

Enter the gross profit percentage determined 

for the year of sale even if you didn’t file Form 

6252 for that year. Enter it as a decimal 

rounded to at least 4 digits, and include all 

zeros (for example, 25% = 0.2500, 35.25% = 

0.3525, or 100% = 1.0000).

Line 21

Enter all money and the FMV of any property 

or services you received in 2023. Include as 

payments any amount withheld to pay off a 

mortgage or other debt or to pay broker and 

legal fees. Generally, don’t include as a 

payment the buyer’s note, a mortgage, or 

other debt assumed by the buyer. However, a 

note or other debt that is payable on demand 

or readily tradable on an established 

securities market is considered a payment. 

For sales occurring before October 22, 2004, 

a note or other debt is considered a payment 

only if it was issued by a corporation or 

governmental entity. If you didn’t receive any 

payments in 2023, enter zero. If in prior years 

an amount was entered on the equivalent of 

line 34 of the 2023 form, don’t include it on 

this line. Instead, enter it on line 23. See

Pledge Rule, earlier, for details about 

proceeds of debt secured by installment 

obligations that must be treated as payments 

on installment obligations.

Line 23

Enter all money and the FMV of property or 

services you received before 2023 from the 

sale. Include allocable installment income and 

any other deemed payments from prior years.

Deemed payments include amounts 

deemed received because of:

• A second disposition by a related party, 

• The pledge rule of section 453A(d), or

• Liabilities assumed by the buyer in excess 

of the seller’s basis. This amount is line 20 

from the year of sale (within the meaning of 

Regulations section 15a.453-1(b)(3)(i)).

Line 25

Enter here and on Form 4797, line 15, any 

ordinary income recapture on section 1252, 

1254, or 1255 property for the year of sale or 

all remaining recapture from a prior year sale. 

Don’t enter ordinary income from a section 

179 expense deduction. If this is the year of 

sale, complete Form 4797, Part III. The 

amount from line 27c, 28b, or 29b of Form 

4797 is the ordinary income recapture. Don’t 

enter any gain for this property on line 31 or 

32 of Form 4797. If you used Form 4797 only 

to figure the recapture on line 25 or 36 of 

Form 6252, enter “N/A” on lines 31 and 32 of 

Form 4797. 

Also report on this line any ordinary income 

recapture remaining from prior years on 

section 1245 or 1250 property sold before 

June 7, 1984.

Don’t enter on line 25 more than the 

amount shown on line 24. Any excess must 

be reported in future years on Form 6252 up 

to the taxable part of the installment sale until 

all of the recapture has been reported.

Line 26

For trade or business property held more than 

1 year, enter this amount on Form 4797, line 

4. If the property was held 1 year or less or 

you have an ordinary gain from the sale of a 

noncapital asset (even if the holding period is 

more than 1 year), enter this amount on Form 

4797, line 10, and enter “From Form 6252.” If 

the property was section 1250 property 

(generally, real property that you depreciated) 

held more than 1 year, figure the total amount 

of unrecaptured section 1250 gain included 

on line 26 using the Unrecaptured Section 

1250 Gain Worksheet in the Instructions for 

Schedule D (Form 1040).

For capital assets, enter this amount on 

Schedule D as a short- or long-term gain on 

the lines identified as from Form 6252.

Part III—Related Party Installment 

Sale Income

Line 29

If one of the conditions is met, check the 

appropriate box and skip lines 30 through 37. 

If you checked box 29e, attach an 

explanation. Generally, the nontax avoidance 

exception will apply to the second disposition 

if:

• The disposition was involuntary (for 

example, a creditor of the related party 

foreclosed on the property or the related party 

declared bankruptcy), or

• The disposition was an installment sale 

under which the terms of payment were 

substantially equal to or longer than those for 

the first sale. However, the resale terms must 

not permit significant deferral of recognition of 

gain from the first sale (for example, amounts 

from the resale are being collected sooner).

Line 30

If the related party sold all or part of the 

property from the original sale in 2023, enter 

the amount realized from the part resold. If 

part was sold in an earlier year and part was 

sold this year, enter the cumulative amount 

realized from the resale.

Amount realized. The amount realized from a 

sale or exchange is the total of all money 

received plus the FMV of all property or 

services received. The amount realized also 

includes any liabilities that were assumed by 

the buyer and any liabilities to which the 

property transferred is subject, such as real 

estate taxes or a mortgage. For details, see

Pub. 544, Sales and Other Dispositions of 

Assets.

Line 33

If you completed Part II, enter the sum of lines 

22 and 23. Otherwise, enter all money and the 

FMV of property you received before 2023 

from the sale. Include allocable installment 

income and any other deemed payments from 

prior years. Don’t include interest, whether 

stated or unstated.

Line 36

See the instructions for line 25. Don’t enter on 

line 36 more than the amount shown on line 

35. Any excess must be reported in future 

years on Form 6252 up to the taxable part of 

the installment sale until all of the recapture 

has been reported.

Line 37

See the instructions for line 26.

Paperwork Reduction Act Notice. We ask 

for the information on this form to carry out 

the Internal Revenue laws of the United 

States. You are required to give us the 

information. We need it to ensure that you are 

complying with these laws and to allow us to 

figure and collect the right amount of tax.

You are not required to provide the 

information requested on a form that is 

subject to the Paperwork Reduction Act 

unless the form displays a valid OMB control 

number. Books or records relating to a form 

or its instructions must be retained as long as 

their contents may become material in the 

administration of any Internal Revenue law. 

Generally, tax returns and return information 

are confidential, as required by section 6103.

The time needed to complete and file this 

form will vary depending on individual 

circumstances. The estimated burden for 

individual taxpayers filing this form is 

approved under OMB control number 

1545-0074 and is included in the estimates 

shown in the instructions for their individual 

income tax return. The estimated burden for 

all other taxpayers who file this form is shown 

below.

Recordkeeping . . . . 1 hr., 18 min.

Learning about the law 

or the form . . . . . . . . 24 min.

Preparing the form . . . . . . 1 hr.

Copying, assembling, and 

sending the form to the IRS . . 20 min.

If you have comments concerning the 

accuracy of these time estimates or 

suggestions for making this form simpler, we 

would be happy to hear from you. See the 

instructions for the tax return with which this 

form is filed.