Solutions For RealSolutions For Real
  • Home
  • News
  • Personal Finance
    • Savings
    • Banking
    • Mortgage
    • Retirement
    • Taxes
    • Wealth
  • Make Money
  • Budgeting
  • Burrow
  • Investing
  • Credit Cards
  • Loans

Subscribe to Updates

Get the latest finance news and updates directly to your inbox.

Top News

How I Went From Side Hustle to 7 Figures Using These 4 AI Tools (No Tech Skills Needed)

July 12, 2025

How Mastering Your Nervous System Boosts Leadership Presence and Performance

July 12, 2025

Mortgage rates tick higher for first time in weeks

July 11, 2025
Facebook Twitter Instagram
Trending
  • How I Went From Side Hustle to 7 Figures Using These 4 AI Tools (No Tech Skills Needed)
  • How Mastering Your Nervous System Boosts Leadership Presence and Performance
  • Mortgage rates tick higher for first time in weeks
  • Social Security & The Big Beautiful Bill
  • Ford Recalls 850,000 Vehicles: What It Means for Your Safety and Your Finances
  • Mark Cuban Says AI Will Mint a Trillionaire. Start Your Climb Here
  • Here’s How Much Google Pays Software Engineers, Designers
  • This Former NFL Player Built a Brand Around Nasal Breathing
Saturday, July 12
Facebook Twitter Instagram
Solutions For RealSolutions For Real
Subscribe For Alerts
  • Home
  • News
  • Personal Finance
    • Savings
    • Banking
    • Mortgage
    • Retirement
    • Taxes
    • Wealth
  • Make Money
  • Budgeting
  • Burrow
  • Investing
  • Credit Cards
  • Loans
Solutions For RealSolutions For Real
Home » IRS Lists Monetized Installment Sales As Abusive Transactions
Taxes

IRS Lists Monetized Installment Sales As Abusive Transactions

News RoomBy News RoomAugust 5, 20230 Views0
Facebook Twitter Pinterest LinkedIn WhatsApp Reddit Email Tumblr Telegram

If you are a seller of appreciated property, it may be attractive to sell it on the installment method. That way, you pay tax over time as you get the installment payments, rather than paying tax all at once. Subject to technical rules and limits, hat is perfectly legal, section 453 of the tax code allows it. But what if you pay tax in installments, but arrange it so you get most or all of your cash up front? The IRS has issued proposed regulations identifying certain monetized installment sale transactions and substantially similar transactions as listed transactions.

That means the IRS has called them abusive tax transactions that must be reported to the IRS. Material advisors and certain participants in these listed transactions are required to file disclosures with the IRS and are subject to penalties for failure to disclose these transactions. The IRS listed monetized installment sales this year as part of the agency’s Dirty Dozen list of common tax scams and schemes. Monetized installment sale transactions generally include the following elements:

  • A seller of appreciated property, or a person acting on the seller’s behalf, identifies a buyer who is willing to purchase the property in exchange for cash or other property.
  • The seller enters into an agreement to sell the property to an intermediary in exchange for an installment obligation, which provides for interest payments from the intermediary to the seller.
  • The seller then purportedly transfers the property to the intermediary, although the intermediary never actually takes title or takes title to the property only briefly before transferring title to the buyer in exchange for the buyer’s cash or other property.
  • The seller also obtains a loan with an agreement that provides for interest payments from the seller to the lender that equal the amount of interest that the intermediary pays the seller under the installment obligation.
  • Both the installment agreement and the loan provide for interest due over the same periods, with principal due in a balloon payment at or near the end of the term of the installment agreement and loan.
  • The sales proceeds received by the intermediary from the buyer, reduced by certain fees, are provided to the lender to fund the loan to the seller or transferred to an escrow account of which the lender is a beneficiary.
  • The lender agrees to repay these amounts to the intermediary over the course of the term of the installment obligation.
  • The seller then treats the sale as an installment sale under section 453 on a Federal income tax return for the year of the purported sale and defers recognition of gain until the year in which the seller receives the principal balloon payment.

Written comments regarding the proposed regulations must be submitted by Sept. 3, 2023. A public hearing has been scheduled for October 12, 2023. As part of the Dirty Dozen awareness effort, the IRS encourages people to report individuals who promote improper and abusive tax schemes as well as tax return preparers who deliberately prepare improper returns. For more information, see Abusive Tax Schemes and Abusive Tax Return Preparers.

Read the full article here

Share. Facebook Twitter Pinterest LinkedIn Tumblr Email

Related Articles

Supreme Court Hears Landmark Tax Case—Here’s Why It Could Destroy Democrats’ Wealth Tax Plans

Taxes December 6, 2023

Taxing Carbon At The Border

Taxes December 5, 2023

In SCOTUS Moore Case, Taxation Without Receipt Of Cash Is Fair Game

Taxes December 3, 2023

Tax Court Finds That Silent Settlement Agreement Means Big Tax Bill

Taxes December 2, 2023

Bill In Congress Aims To Stop Kombucha From Being Taxed Like Beer

Taxes December 1, 2023

Building Housing Lowers Prices But “Supply Skeptics” Don’t Believe It

Taxes November 30, 2023
Add A Comment

Leave A Reply Cancel Reply

Demo
Top News

How Mastering Your Nervous System Boosts Leadership Presence and Performance

July 12, 20250 Views

Mortgage rates tick higher for first time in weeks

July 11, 20250 Views

Social Security & The Big Beautiful Bill

July 11, 20250 Views

Ford Recalls 850,000 Vehicles: What It Means for Your Safety and Your Finances

July 11, 20250 Views
Don't Miss

Mark Cuban Says AI Will Mint a Trillionaire. Start Your Climb Here

By News RoomJuly 11, 2025

Kathy Hutchins / Shutterstock.comMark Cuban is making a bold prediction that has everyone talking: AI…

Here’s How Much Google Pays Software Engineers, Designers

July 11, 2025

This Former NFL Player Built a Brand Around Nasal Breathing

July 11, 2025

What My First Failed Startup Taught Me — and How I Finally Got It Right 20 Years Later

July 11, 2025
About Us
About Us

Your number 1 source for the latest finance, making money, saving money and budgeting. follow us now to get the news that matters to you.

We're accepting new partnerships right now.

Email Us: [email protected]

Our Picks

How I Went From Side Hustle to 7 Figures Using These 4 AI Tools (No Tech Skills Needed)

July 12, 2025

How Mastering Your Nervous System Boosts Leadership Presence and Performance

July 12, 2025

Mortgage rates tick higher for first time in weeks

July 11, 2025
Most Popular

51 Reasons I Won’t Lend Money to Friends and Family

August 6, 20231 Views

How I Went From Side Hustle to 7 Figures Using These 4 AI Tools (No Tech Skills Needed)

July 12, 20250 Views

How Mastering Your Nervous System Boosts Leadership Presence and Performance

July 12, 20250 Views
Facebook Twitter Instagram Pinterest Dribbble
  • Privacy Policy
  • Terms of use
  • Press Release
  • Advertise
  • Contact
© 2025 Solutions For Real. All Rights Reserved.

Type above and press Enter to search. Press Esc to cancel.