I closed my sole proprietorship (schedule c) mid year

[hauvic]

I closed my schedule c business mid year and started an LLC with a partner. So where do I indicate on the C that I closed the business and that the C is for a partial year?

Also if I don't contribute all the assets that were in the Sole proprietorship, can I hold them personally at their depreciated basis? Or will there be a tax effect? (I know there would be if I sold them.)

[VolvoGirl]

I don't know the answers to all your questions.  If you need to close a business schedule C, see this article on closing a business
<a rel="nofollow" target="_blank" href="https://turbotax.intuit.com/tax-tools/tax-tips/Small-Business-Taxes/Closing-a-Business/INF12028.html...>

FAQ post on closing
<a rel="nofollow" target="_blank" href="https://ttlc.intuit.com/questions/1899235-how-do-i-delete-a-prior-year-schedule-c-business-that-tran...>


Go to Federal Taxes Tab
Wages and Income,
Choose Jump to Full List -or I'll choose what I work on
Then scroll way down to Business Items

Then…..
Business Income and Expenses - Click the Start or Update button

You should see the Business Summary page that lists your businesses, (right below the list you can Add Another Business)

Then click EDIT by the business name and the next screen should be a list of  topics,
Business Profile, Income, Inventory/Cost of Goods Sold, Expenses, Assets, and Final Details last.

Click Start or Update by Business Profile
Then click Edit by the item you need to change
Disposed of business in current year is the 4th Edit button

[TaxGuyBill]

There is nowhere on Schedule C to indicate your business closed or that it was for a partial year.  You don't need to indicate that on the actual tax forms.  Just go through the program to report the "assets" were converted to personal use.

Yes, you can convert assets to personal use without any taxes unless you previously used Section 179 on those assets.  If you used Section 179, then there would be some taxes on the recapture of the Section 179.

[VolvoGirl]

Oh, right.  I guess the profile line in the program is just to not transfer that sch C to the next year.  I know it does that.

[TaxGuyBill]

Good point about the transfer.  Make sure you tell TurboTax that you closed the business (I think it is in the introductory part/business profile part of the business questions), or else it may try to automatically put Schedule C on next year's tax return.

[MichaelDMiller]

I tried going through the step-by-step in business and never ran across a button that asked me about closing the business.

[MichaelDMiller]

If you need to close a business schedule C, see this article on closing a business
<a rel="nofollow" target="_blank" href="https://turbotax.intuit.com/tax-tools/tax-tips/Small-Business-Taxes/Closing-a-Business/INF12028.html...>

that link is not there.

[MichaelDMiller]

FAQ post on closing
<a rel="nofollow" target="_blank" href="https://ttlc.intuit.com/questions/1899235-how-do-i-delete-a-prior-year-schedule-c-business-that-tran...>

Didn't take me there.

[MichaelDMiller]

Go to Federal Taxes Tab
Wages and Income,
Choose Jump to Full List -or I'll choose what I work on
Then scroll way down to Business Items
(OK)
Then…..
Business Income and Expenses - Click the Start or Update button

You should see the Business Summary page that lists your businesses, (right below the list you can Add Another Business)

Then click EDIT by the business name and the next screen should be a list of  topics,

(OK)

Business Profile, Income, Inventory/Cost of Goods Sold, Expenses, Assets, and Final Details last.
(I don't think there was a Business Profile)
Click Start or Update by Business Profile
Then click Edit by the item you need to change
Disposed of business in current year is the 4th Edit button

  (No Such Button or Question Exists)

[MichaelDMiller]

Solved by TTAX support. Applies to my situation of tax year 2019.

a) print all asset and depreciation schedules and summaries to keep a record of Acquis Date, Placed in Svc Date, and Cost/Basis/Business %, Depr for 2019, Accum Depr, Sec 179 purchases, etc. as you will be deleting sched C (below) in tax year 2020, and you may end up selling any equipment. If so, you may need to recapture depr on some assets.

1) if you had sched c income and? expenses for tax year 2019, you must file a sched c for the year.

2) if converting to personal use (not selling, abandoning, etc.; you still have all the equip, DO NOT fill in the Sale date and zero for amounts. I did that for 245 assets and now I have to go thru them again and remove the sale dates.

3) in the 2020 tax year, you will Delete the sched C form. Most of the responders here did mention using the step by step interview for Income and Expenses, drilling down to the sched C and there is a Delete button there. It may offer a convert to personal, but I am not going to test that for fear. But in 2020, I assume that if you delete the sched C form even from View Forms Mode (the only way I enter data), it will work properly.

4) Deleting the Sched C in the 2020 tax year, (has to be No Activity), TTAX will delete all supporting schedules. Many of those depr schedules and home office form, will have numbers in them, but you will delete the sched C as your first task, as "C" does not apply to you anymore.

[Critter-3]

To keep the Sch C from transferring to the 2020 return you need to indicate the business ended in 2019 in the business info section which will also prompt the disposal of asset questions later in the interview.