Irs Instructions For Form 6252 1993 (Page 2 of 2) in pdf

outstanding at the close of, the tax year is

deducted from the date of purchase until

any remaining recapture from a prior year

more than $5 million.

the date of sale. Add any section 179

sale. Do not enter ordinary income from a

expense deduction; the downward basis

section 179 expense deduction. If this is

Interest must be paid in subsequent

adjustment under section 50(c) (or the

the year of sale, complete Form 4797, Part

years if installment obligations, which

corresponding provision of prior law); the

III. The amount from line 29c, 30b, or 31b

originally required interest to be paid, are

deduction for qualified clean-fuel vehicle

of Form 4797 is the ordinary income

still outstanding at the close of a tax year.

property or refueling property; and

recapture. Do not enter any gain for this

These rules do not apply to dispositions

deductions claimed under section 190,

property on line 33 or 34 of Form 4797. If

of:

193, or 1253(d)(2) or (3) (as in effect before

you used Form 4797 only to figure the

Farm property,

the enactment of P.L. 103-66). Subtract

recapture on line 25 or 36, enter “N/A” on

any investment tax credit recapture

lines 33 and 34 of Form 4797.

Personal use property by an individual,

amount if the basis of the property was

Also report on this line any ordinary

Real property in tax years beginning

reduced under section 50(c) (or the

income recapture remaining from prior

before 1988, or

corresponding provision of prior law); any

years on section 1245 or 1250 property

Personal property before 1989.

section 179 or 280F recapture amount

sold before June 7, 1984.

included in gross income in a prior tax

How to report the interest.—The interest

Do not enter on line 25 more than the

year; and any qualified clean-fuel vehicle

is not figured on Form 6252. See section

amount shown on line 24. The excess

property or refueling property deduction

453A to figure the interest. Enter the

must be reported in future years on Form

you were required to recapture because

interest as an additional tax on your tax

6252 up to the taxable part of the

the property ceased to be eligible for the

return. Include it in the amount to be

installment sale until all of the recapture

deduction. Do not include on this line any

entered on the total tax line after credits

has been reported.

section 179 expense deduction for a

and other taxes. For individuals, this is line

Line 26.—For trade or business property,

partnership or an S corporation that

53 of the 1993 Form 1040. For

enter this amount on Form 4797, line 4, if

passed through the deduction to its

corporations, it is line 10 of Schedule J

the property was held more than 1 year. If

partners or shareholders.

(Form 1120). Write “Section 453A(c)

the property was held 1 year or less, or if

interest” to the left of the amount.

Line 11.—Enter sales commissions,

you have an ordinary gain from a

advertising expenses, attorney and legal

Corporations may deduct the interest in

noncapital asset (even if the holding period

fees, etc., in selling the property.

the year it is paid or accrued. For

is more than 1 year), enter this amount on

individuals and other taxpayers, this

Line 12.—Any ordinary income recapture

Form 4797, line 11, and write “From Form

interest is not deductible.

under section 1245 or 1250 (including

6252.”

sections 179 and 291) is fully taxable in

Additional Information

For capital assets, enter this amount on

the year of sale even if no payments were

Schedule D as a short-term or long-term

received. To figure the recapture, complete

See Pub. 537 for additional information,

gain. Use the lines identified as from Form

Form 4797, Part III. The ordinary income

including details about reductions in selling

6252.

recapture is the amount on line 33 of Form

price, the single sale of several assets,

4797. Enter it on line 12 of Form 6252 and

like-kind exchanges, dispositions of

Part III—Related Party Installment

also on line 14 of Form 4797. Do not enter

installment obligations, and repossessions.

Sale Income

any gain for this property on line 34 of

Form 4797. If you used Form 4797 only to

Line 29—If one of the exceptions apply,

figure the recapture on line 12 of Form

check the appropriate box. Skip lines 30

Specific Instructions

6252, enter “N/A” on line 34 of Form 4797.

through 37. If you checked box 29e, attach

an explanation. Generally, the nontax

Part II—Installment Sale Income

Part I—Gross Profit and Contract

avoidance exception will apply to the

second disposition if:

Price

Line 19.—Enter the gross profit percentage

determined for the year of sale even if you

The disposition was involuntary (e.g., a

Line 5.—Enter the total of any money, face

did not file Form 6252 for that year.

creditor of the related person foreclosed

amount of the installment obligation, and

on the property, or the related person

Line 21.—Enter all money and the fair

the fair market value of other property that

declared bankruptcy), or

market value of any property you received

you received or will receive in exchange for

in 1993. Include as payments any amount

The disposition was an installment sale

the property sold. Include on line 5 any

withheld to pay off a mortgage or other

under which the terms of payment were

existing mortgage or other debt the buyer

debt, such as broker and legal fees. Do

substantially equal to or longer than those

assumed or took the property subject to.

not include the buyer’s note, any

for the first sale. However, the resale terms

If there is no stated maximum selling

mortgage, or other liability assumed by the

must not permit significant deferral of

price, such as in a contingent sale, attach

buyer. If you did not receive any payments

recognition of gain from the first sale (e.g.,

a schedule showing the computation of

in 1993, enter zero.

amounts from the resale are being

gain. Enter the taxable part on line 24 and

collected sooner).

If in prior years an amount was entered

also on line 35 if Part III applies. See

on the equivalent of line 32 of the 1993

Line 30.—If the related party sold all or

Temporary Regulations section 15A.453.

form, do not include it on this line. Instead,

part of the property from the original sale

Line 6.— Enter only mortgages or other

enter it on line 23.

in 1993, enter the selling price of the part

debts the buyer assumed from the seller or

resold. If part was sold in an earlier year

See Pledge Rule on page 1 for details

took the property subject to. Do not

and part was sold this year, enter the

about proceeds of debt secured by

include new mortgages the buyer gets

cumulative amount of the selling price.

installment obligations that must be treated

from a bank, the seller, or other sources.

as payments on installment obligations.

Line 36.—See the instructions for line 25,

Line 8.—Enter the original cost and other

above. Do not enter on line 36 more than

Line 23.—Enter all money and the fair

expenses you incurred in buying the

the amount shown on line 35. The excess

market value of property you received

property. Add the cost of improvements,

must be reported in future years on Form

before 1993 from the sale. Include

etc., and subtract any qualified electric

6252 up to the taxable part of the

allocable installment income and any other

vehicle credit, diesel-powered highway

installment sale until all of the recapture

deemed payments from prior years.

vehicle credit, enhanced oil recovery credit,

has been reported.

Line 25.—Enter here and on Form 4797,

disabled access credit, or casualty losses

Line 37.—See the instructions for line 26,

line 16, any ordinary income recapture on

previously allowed. For more details, get

above.

section 1252, 1254, or 1255 property. This

Pub. 551, Basis of Assets.

includes recapture for the year of sale or

Line 9.—Enter all depreciation or

amortization you deducted or should have

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Irs Instructions For Form 6252 1993 Page 2

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