1041-US: Sale income reported as ordinary income for a mass disposition (FAQ)

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Question

For an installment sale that originated as a mass disposition, why is the sale income reported as ordinary income and not capital?

Answer

Because there are various purchase dates, the asset module reports the date acquired as "Various." Since an accurate holding period is not available with "Various", the application defaults to the most conservative tax approach in this situation. You should report the gain / loss in the asset module by selecting the appropriate property type in the Type of Property field or enter a date in the Date in service field in the statement dialog for the Enter Disposal field in the asset module.

Related topic: 1041-US: Business and capital asset sale information FAQs

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