I'm winding down a small service business and I also own the building it runs out of. My accountant used the phrase installment sale when I mentioned carrying paper for the buyer, and I nodded like I understood.
Are those the same thing under two names, or is one the deal and one the tax treatment? I want to understand what I'm agreeing to before the next call.
One is the deal, one is how the gain gets reported. Seller financing describes the arrangement, you're the lender, buyer pays you over time. Installment sale is the tax framework where you recognize your gain as the principal comes in rather than all in the year of sale, which is usually why sellers care.
They overlap almost always but they aren't automatically the same. Depreciation recapture on a building can be pulled forward in the year of sale even when the cash arrives over ten years, which is a nasty surprise if you assumed everything spreads evenly. That's a your-accountant question, but ask it specifically instead of nodding, because the number can be real on a building you've held a while.