Question 30 of 75.

How is interest received on an installment sale typically reported on an individual tax return?

On Schedule1 (Form 1040), as other income.

On Schedule B, in the same manner as other interest.

As a gain on Schedule D.

As payments received during the year in the "Installment Sale Income" section of Form 6252.

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Disposition of Business Assets

Question 31 of 75.

A vehicle, purchased and currently used by a business, is classified as what type of property?

Section 1231.

Section 1245.

Section 1250.

Section 1252.

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Question 32 of 75.

A taxpayer who lost property to foreclosure during the year brings a Form 1099-A to their tax appointment. Box 5 of the form is checked, indicating that the taxpayer was personally responsible for repaying the debt. This informs the tax preparer that the taxpayer:

Cannot have taxable income associated with this event.

Cannot have ordinary income from this event, but may have a capital gain.

Does not need to report the information on their tax return unless they also received a Form

1099-C.

May be responsible for any remaining balance due on the mortgage, even after the foreclosure and sale is complete.

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