DEAR BOB: When you first started writing your real estate articles years ago we were living in Washington, D.C. You suggested that an installment sale was the best way to sell our home. It sounded like a good idea and our attorney and tax man agreed, so we sold on an installment sale. By the first of every month since then, we've received our check from the buyer for over $700. Sometimes she even pays us early. We just wanted to write to let you know how your short little article led to our financially secure retirement in Florida. Kendall M., Naples, Fla.

DEAR KENDALL: Many thanks for sharing your sucess story. Too many retirees foolishly demand all cash when selling their homes and then wind up wasting that cash received. Installment sales not only are a great way to maximize your income and minimize the tax, but they are also great investments, usually with a better return than can be earned elsewhere.

DEAR BOB: Can owners of co-op and condo apartments take dekuctions for their share of the owner's association mortgage interest? Manuel M., Washington.

DEAR MANUEL: Most co-op and condominium complexes have non-profit owners associations that should report to each owner his share of any tax deductible mortgage interest and property tax. Of course, condominium owners have individual mortgages on their units but there may be, in addition, a mortgage on the common areas that could give additional tax deductions. Contact the treasurer or secretary of your owner's association for details.

DEAR BOB: Is it true that water bills paid to a municipal water department are tax deductible? Homer M., Alexandria.

DEAR HOMER: That can be partly true. If part of your water bill payment goes to pay interest on water bonds or similar financing for the city water department, then such interest is tax deductible.