The U.S. IRS has published a practice unit on Interest on Deferred Tax Liability in relation to an installment sale. The process overview of the practice unit includes the following:
An installment sale is a disposition of property where the seller will receive at least one payment after the tax year in which the disposition occurs. Unless the seller elects otherwise (or an exception applies), the seller should use the installment method to compute income from an installment sale. The insta…