Do you pay capital gains on a land contract sale even though you don't get all the money in one year?

Answer 1

A contract sale is called an installment sale for tax purposes. During the first year that you receive payments, the capital gain is calculated as a percent....for example, you are selling a piece of land for $100 that you bought for $80 two years ago, and you will be receiving $20 a year for 5 years. The capital gains percent is 20%, therefore 20% of every dollar paid towards the principal will be taxed at the capital gains tax rate.

Answer 2

You count the money in the years that you get it.
They call this an installment sale.

But it would be best to get an official ruling on this.