The IRS Audit Blog

Archive for April, 2010

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Question: which irs forms do we use to claim a business that we sold and financed?

We had a business that was a corp, We dissolved the corp and converted it to a sole prior. on August 1st, 2008. (the cpa has already closed out the corp.and was approved by the state to dissolve the business, therefore all the required forms have been filed on the corp.) Due to illness we had to sell the business on 12.31.08, we financed the note,and Im trying to do our own taxes to save some money. Actually we had the business as a sole prior. for less than a year.

Answer: You mean a sole proprietorship, right? There isn’t supposed to be a “we” owning a sole proprietorship. (Look up the definition of sole http://dictionary.reference.com/browse/sole )

Based on what you wrote in your question, the best advice I can give you is to go back to the CPA or use another tax professional. This is a case where saving money now will cost you a lot more in the future. Also, it depends on the exact terms of the business sale. It would be irresponsible for me to answer your question without reviewing the sales agreement and related documents. (In fact, answering this question without the facts could easily lead to charges that may well result in a fine or the loss of my CPA certificate.)

I hope this helps.
Gary

Deb Price: ‘Dear IRS’

The Internal Revenue Service often finds my family confusing, and this year is no exception.

JAMES TRAFICANT 4of5 TAXPAYER’S CHAMPION VS. IRS & AIPAC (AMERICAN ISRAEL PUBLIC AFFAIRS COMMITTEE)