Re-reading my comment above...…..I don't think I answered the question very well.

Farmers are allowed to report the sales of their property which is used or produced in their business of farming on the installment basis.  (Other "dealers" cannot report inventory sales on the installment basis.)

An installment sale occurs when at least one payment is received in a year subsequent to the year of sale.  That payment can be all or only a part of the sales price.

To NOT report the sale on the installment basis, ie to "elect out of the installment reporting", one merely includes the sale in their TIMELY FILED tax return in the year of sale.  That means that if grain is delivered, and the payment is received in the next year, AND THE RETURN is not timely filed, then the grain MUST be reported in that subsequent year when the payment was received.

That is why the grain processor made the comment that he did-------- he was telling you that you could report the sale in the current year, or in the subsequent year when the payment was made......your choice.

If you had not delivered the grain in the current year...……...then you would have been SOL, since a "sale" would not have been made.

This installment sale allowance for farmers is why farmers can sell grain on deferred payment contracts.    Farmers can deliver their grain in one tax year, receive payment in another, and report the sale in the year of payment.

Further, a farmer can split his income-------as long as at least one payment is received in a year subsequent to the year of sale.  Example...…...farmer delivers $100K of corn in 2018...….and takes 40K in cash, and receives the remaining 60K in the next tax year 2019.  The sale of 2018 is reported as income 40K in 2018, and 60K in 2019...…...even if the returns are not timely filed.

The sale of anything used or produced on the farm is subject to installment reporting.....by farmers.

However...…...if the item has been depreciated...…..the amount of depreciation is subject to recapture in the year of sale, regardless of the amount of cash received.