Moving assets to new company

[oceanlovin'ea]

TP had a business in Georgia for several years. Moved to Florida in May 2009 and started new LLC taxed as s corp in Florida. He transferred all his equipment to his new company.

Everything had been fully depreciated in the old company. How do I transfer equipment with a zero basis to the new company?

That sounds like a strange question.

Linda

[ChEAr$]

TP had a business in Georgia for several years. Moved to Florida in May 2009 and started new LLC taxed as s corp in Florida. He transferred all his equipment to his new company.

Everything had been fully depreciated in the old company. How do I transfer equipment with a zero basis to the new company?

That sounds like a strange question.

Linda

Since the assets belong to him personally ( I assume it was a proprietorship in Georgia),
there's no need to transfer any assets to a new company. He can still continue to use
said assets in the new business with no tax consequence atall.

[Maribeth]

If your client was practicing in the corporate form, then simply transfer the equipment to the new corporation at NBV, which is zero. Your asset cost would be the same as your accumulated depreciation.

Remember that you will also have reporting requirements under §351.

Maribeth

[DMICPA]

Asset Transfer

I had an S-Corp. The corporation was dissolved after several years. I retained the assets and transferred them to my new sole proprietorship at the FMV at the date of dissolution because I had to pick up a taxable liquidating dividend on this value.

Since I paid income tax on the dissolution dividends, the basis of the assets in the sole proprietorship should be my cost.

[ttbtaxes]

Was the transferor a Schedule C or a corporation?

[JON]

If the GA

was a corporation you only get them out of a Corporation at FMV with a tax to the Corp and a liquidating distribution to the stockholder(s) when finished. I think if there are gains it is easier to dissolve the GA operations and register in Fl. A bigger question is does 351 come into play when assests are transferred to an LLC.. I do not think so. 351 is for incorprations. Does an LLC electing to be taxed as a corporation then require you to file for 351 treatment. ?????