Sandy Gadow, a featured guest on CNN's "Open House," and a speaker on national radio as the escrow expert, has more than 25 years experience in escrow, title and real estate. A licensed mortgage broker and real estate sales associate, Sandy is a member of the American Land Title Association, the National Association of Realtors, the California Escrow Association and on the advisory council for the Escrow Career Center. She is the author of The Complete Guide to Your Real Estate Closing and specializes in assisting the American as well as international client. If you have questions for Sandy see our Ask Sandy page.

How Am I Taxed in an Installment Sale?

Installment sales are used to help spread out capital gains on a property for a period of more than one year. This is done by taking several, smaller payments for the sale of property instead of one large sum of money. A seller may also carry back a note, allowing the tax payments to be deferred.  When a seller takes the option of a wrap around loan, or an all-inclusive trust deed, monthly payments are made from the buyer and the seller is only taxed on the gain earned in one year's time, which will be spread out over the term of the trust deed.

Copyright © 2006 Sandy Gadow. All Rights Reserved. This article may not be resold, reprinted, resyndicated or redistributed without the written permission from Escrow Publishing Company.