Sale of Sole Proprietorship, Inventory, Fixtures, Goodwill

[Patitaylor]

I sold my retail store in 2019.  I sold it for the cost of the inventory, some fully depreciated furniture and fixtures and goodwill.

How do I record this sale?

[AmeliesUncle]

TurboTax does not have one of the forms that is required to report that situation (Form 8594).  You may consider a tax professional.

[Patitaylor]

I have used Tt for years and including for a much more complicated situation, an installment sale of a rental business.  There must be a way to file the 8594 separately?

[Rick19744 · Accepted solution]

While your sale may appear fairly straight forward, most are not, and that is the reason for completing form 8594.  The IRS is looking for consistency in the tax treatment of the assets that were sold.

Attached are the instructions for form 8594.  You will note on the first page under when to file, it states to attach the form to "your income tax return".

TT is not set up to handle ALL situations.  TT can handle the return, determine the gain, loss, ordinary income component, etc., but you will need to manually complete the form, attach it to your tax return and paper file your tax return.

https://www.irs.gov/pub/irs-pdf/i8594.pdf

Some returns are able to be efiled and attachments are sent separately, however, there are limited situations.  Attached is the form 8453 which details the forms in which attachments can be sent separately.  Form 8594 is not a listed form.

https://www.irs.gov/pub/irs-pdf/f8453.pdf

[Patitaylor]

Thank you.  This is what I was wondering. I have a copy of the form, and I have the information to prepare it.  It's too bad I'll need to paper file, but it seems like what will need to happen.  Thanks for your help.

[Rick19744]

You are welcome