26 U.S.C. § 453 — Installment method
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“(2) Exceptions The term “installment sale” does not include— (A) Dealer dispositions Any dealer disposition (as defined in subsection (l)). (B) Inventories of personal property A disposition of personal property of a kind which is required to be included in the inventory of the taxpayer if on hand at the close of the taxable year.”
The term “installment sale” means a disposition of property where at least 1 payment is to be received after the close of the taxable year in which the disposition occurs.
(2) Exceptions
The term “installment sale” does not include— (A) Dealer dispositions Any dealer disposition (as defined in subsection (l)). (B) Inventories of personal property A disposition of personal property of a kind which is required to be included in the inventory of the taxpayer if on hand at the close of the taxable year.
(c) Installment method defined For purposes of this section, the term “installment method” means a method under which the income recognized for any taxable year from a disposition is that proportion of the payments received in that year which the gross profit (realized or to be realized when payment is completed) bears to the total contract price.
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