closing a business

Forum|Forum|5 years ago
March 18, 2021
1 reply
10 views

I have a small business refurbishing boats but I want to close it down. I have a $15,000 boat in inventory now can I transfer it to myself ? What is the best way to minimize my tax bill ?

gloriah5200

Level 10

How you close down a business depends on the type of business entity it is and how you have been managing it.

For instance, if you are a Schedule C Sole Proprietor, the business is an extension of you. If you have business assets that you have deducted as business assets on your return or depreciated them, then when you sell or dispose of them, you must report them as the sale of business assets because you received a personal deduction for them.

In order to dispose of assets properly in TurboTax, they have to be set up in TurboTax correctly. Before you dispose of an asset, you will have to enter the asset, its cost, the date it was placed in service, etc. The program will calculate prior year depreciation which it will use to calculate gain or loss on disposal.

It's very difficult to troubleshoot issues like this without being able to see what's happening. You may want to utilize TurboTax Live, that will let you talk to a CPA or EA who can also see your tax return. For more information see What is TurboTax Live?

For additional information, please refer to the following link:

How to report sale of business and assets in TurboTax