The IRS has certain rules that pertain to Section 179 expense election and installment reporting. This information is important for those who engage in real estate transa

The Sec. 179 amount that was deducted (but not more than the total gain on the sale) is ordinary income in the year of sale, regardless of the date of the sale and regardless of the amount of principal actually received in that year.  Add Section 179 deduction back to the adjusted basis in figuring profit percentage (IRC Sec 453(i)).