This form computes the portion of income from an installment sale that is taxable in 2010. The sale itself can have occurred in 2010 or a previous year.
At the top of this form, you indicate where you would like the totals to carry. This entry specifies the destination for the nonrecapture amounts (lines 26 and 37). The recapture amounts (lines 25 and 36) always carry to Form 4797. (A "recapture amount" is an amount that is treated as "ordinary income," not capital gain or Section 1231 income. Typically, this represents depreciation which had been deducted as ordinary loss, and so must be treated as ordinary income when the asset was sold).
If question 3 is not "Yes," then we blank both responses to question 4.
If you respond "Yes" to the question whether the property was your principal residence, we put on line 15 the amount from the Sale of Home Worksheet line 14.
Copy 1 of Form 6252 draws this from Copy 1 of the Sale of Home Worksheet, and Copy 2 of Form 6252 draws data from Copy 2 of the Sale of Home Worksheet. If you sold your home on the installment method, you should report that sale on Copy 1 (most likely) or Copy 2 of Form 6252.
If you have X'd the box to indicate that this is the year of the sale, then we calculate lines 19 and 20. Otherwise we leave line 19 for your entry and set line 20 to zero.
If line 28 ("Did the related party resell the property...") is X'd, and none of the other exceptions is X'd, then we calculate lines 30 through 37 as indicated. Otherwise, we set these values to zero.
If we are not setting line 31 to zero (see above), and this was the year of sale, then we carry line 31 from line 18. Otherwise, we set line 31 to be available for your entry.