Go to the IRS website (www.irs.gov) and redo Problem 7 using the most recent Form 6252, Installment Sale Income. Print out the completed Form 6252.

Problem 7:

Steve Drake sells a rental house on January 1, 2016, and receives $120,000 cash and a note for $45,000 at 10 percent interest. The purchaser also assumes the mortgage on the property of $35,000. Steve’s original cost for the house was $180,000 and accumulated depreciation was $30,000 on the date of sale. He collects only the $120,000 down payment in the year of sale.