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inbb2b
Returning Member

business losses from forced closure by owner on form 1065

The owner/landlord escorted us out of a restaurant we ran as an LLC and kept everything.

I put closing date of 4/30/2025 and it finished depreciation of $25K of appliances and it propagated to form 4797

 

Where would I input the losses from $20K of inventory, $30K of furniture, 8 TV's, POS system and many other assets that I did not previous depreciate and owner kept. I see dispose of business property but that doesn't propagate to form 4797

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2 Replies
MelindaS1
Employee Tax Expert

business losses from forced closure by owner on form 1065

Assuming that these are assets that you previously paid for in full and had full ownership rights of, you would enter these as Sales of Business Property with proceeds of $0. That will compute a business loss on the book value of the assets. The date of sale will be the (documented) day you were evicted from the premises. 

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business losses from forced closure by owner on form 1065

if you previously expensed inventory purchases, you've already taken the deduction for it. you can't deduct it a second time. if you do account for inventory and purchases just indicate ending inventory as $0

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