I own a small business, under sole properitorship, we moved to GA last year from CO mid year, not sure how to input both states on taxes without creating a "new business"

[livGA27]

We moved to a new state middle of the year from CO. I own a small business under my name (sole propertorship). I have a 1099-K from Paypal sales as well as cash/cards.   It's the same business, name and everything, just located in a new state. How do I input this into Turbotax? I tried creating a "new business" under Turbo Tax for GA but I can't enter in the beginning inventory costs because it thinks it's a "new business". Do I delete that and just file all under one name even though we are under multiple states? Help!

[ColeenD3]

Yes, you only have one business. For the Federal return, nothing has changed. You will need to do two part-year state returns, allocating the 1099-K amount according to how much was earned in each state.

[livGA27]

Thank you! Okay so enter it under the one business, but how do I enter a two part-year state return without creating a seperate business? 

[Carl]

You will be filing two "part year resident" state returns. Save the new state for last. On each state, you only report income/expenses received/incurred in that state.

Nothing changes on the federal return, except maybe the current address of the business.

Was there a home office for the business in each state? If so, then on the federal return you have to close the hold home office on or before the date you vacated the old home, and then open a new home office on or after the date you moved into the new home. So on your federal return you'll have two home offices. One for the old home, and another for the new home. Make sure the active dates for the two home offices do not overlap.

[ToddL99]

Enter the one business in your federal return - that information will carry over to both of your "part-year resident" returns, and you will be able to allocate how much of the total is reported to each state.

In the state tax programs for GA and CO, you will have an interview screen that allows you to allocate the business income from your federal return. You will have to calculate how much of that business income was allocable ("earned") to CO and how much was allocable to GA. Enter the appropriate amounts in each state tax interview income allocation screen.

Here is what the GA allocation screen looks like:

[livGA27]

Okay thank you! 

[ckoeppel1]

I lived in the state of Washington until August 21, 2020. I owned a small business there, but closed all licenses. I moved to Iowa and started my same business (bakery) from home. I kept the same business name. I am still waiting on licensing in Iowa but continue to bake. I have income for January through August in Washington and income from September to December in Iowa. Do I need to claim the Iowa income as combined on federal and separate as part year resident for state? Or since I am not licensed yet, do I even need to claim that Iowa income? Washington doesn’t require a state tax. 

[Carl]

Based on the information provided, it sounds to me like you had two distinctly separate businesses in 2020. You closed one permanently and forever, and would therefore be filing a final SCH C for that business. Any and all assets in that business would be shown as being removed from the business for personal use.

Then, you opened a completely new business in another state, also in 2020. More than likely this new business will require a new EIN (unless you're using your SSN instead, which is not an option if you have W-2 employees in your business.)

That means you would be filing two SCH C's for 2020. A final SCH C for the closed business, and a new SCH C for the new business.

Then if both states tax personal income, (I don't know if they do or not) then you'd be filing a part year resident tax return for the old state, and a part year resident tax return for the new state. If this is necessary, safe the state tax return for your new resident state for last.

[tagteam]

I have to disagree with respect to a new EIN being required.

I do not believe @ckoeppel1 will need a new EIN (assuming @ckoeppel1 currently has an EIN and is not using an SSN).

See https://www.irs.gov/businesses/small-businesses-self-employed/do-you-need-a-new-ein