topic Reporting Good Will in Get your taxes done using TurboTax

Reporting Good Will

gtseener — Sat, 27 Mar 2021 17:52:27 GMT

Does goodwill for the sale of a business only get reported on form 8594 as a class VII asset or will there be a 1099-misc?

Re: Reporting Good Will

ColeenD3 — Sat, 27 Mar 2021 18:07:25 GMT

It would also be reported on Schedule D.

The sale of goodwill is a capital asset and should be reported on Schedule D. You should also have Form 8594 completed (both buyer and seller do this and they should agree). If you do not file a correct Form 8594 by the due date of your return and you cannot show reasonable cause, you may be subject to penalties.

Per the IRS, The purpose of filing the form is "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."

This form is not available for electronic filing, so you will have to mail in your return.

For further information about the form 8594, please refer to the instructions for IRS form 8594 at the following link:

Form 8594

Re: Reporting Good Will

Mike9241 — Sat, 27 Mar 2021 18:40:36 GMT

not only do you report the sale of goodwill. but also the proceeds for the sale of other assets for the amount on the 8594. not all will be capital assets ented on schedule D but probably entered through schedule C. examples sale of depreciable property, inventory. accounts receivable. classes I through V only class VI and VII are capital assets.