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New Member
posted May 16, 2021 12:48:52 AM

When shutting down the business we purchased (due to pandemic and declining sales), can we deduct the original purchase price?

For example, if we purchased a business for $50k 7 years ago.    We were unable to sell it so we had to shut it down in 2020 during the pandemic and liquidate what assets we have left.   Can we deduct the original purchase price of $50k for the tax year we closed down the business?

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2 Replies
Expert Alumni
May 16, 2021 9:20:06 AM

If you haven't  already taken that as a deduction, then yes.  Not only are all assets liquidated upon sale, but all liabilities are reconciled also.  When a business is reconciled in this way, a loss is common.  

 

 

New Member
May 16, 2021 8:52:29 PM

Thanks.   So within turbotax online,  do i report closing down my business as "Sale of Business Property" with a price of zero and cost basis of my purchase price?