Bought a business June 2018 do I need a form 8594

[Wild-Inspirations]

Im a new business owner and bought the business in June of 2018 it is a Gift shop with some consignment. Do I need a form 8594?

[DDollar · Accepted solution]

Probably.  According to the IRS:

Both the seller and purchaser of a group of assets that makes up a trade or business must use Form 8594 to report such a sale if goodwill or going concern value attaches, or could attach, to such assets and if the purchaser's basis in the assets is determined only by the amount paid for the assets.

So, if you paid the seller more than actual value of the physical assets you purchased (i.e. goodwill) then you need to file Form 8594.

[Wild-Inspirations]

Im in a land contact with the seller and making payments how does that work

[Wild-Inspirations]

the land with the build I run the business out of

[DDollar]

What do you mean by "land contract"  Did you buy the building?  Did you buy the land?  Is there an installment sale?

[Wild-Inspirations]

I make monthly payments to the owner for the land and build to buy this is where the business is

[DDollar]

I think it would be wise for you to consult a local CPA. You're getting in details that require more information and details than can be provided via this public forum.  It's very important you your business set up properly from the start for tax purposes.