(Disclaimer: I am trying to get some consulting time with a real CPA!)
To keep this short: dividing a small building lot off of a much larger parcel, owned for over a year. Selling the building lot with yearly chunked payment terms, with closing scheduled for four years out. It is a not-insignificant amount of $. (This deal is being worked out by real lawyers, don't worry.)
What am I looking at for taxes, and when do I pay them? How do I calculate the capital gains if this is a small (<5%) portion of the original property I purchased as a primary residence, but it itself is an undeveloped building lot? Would I pay the full brunt of any associated taxes the year of the closing, or should I be paying it on the yearly payments? I would report those yearly payments as income.....?