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s corp assets converted to personal

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    s corp assets converted to personal

    S corp closed as of 12/31/10. Preparing final return. The assets have been depreciated and have a zero basis.
    In converting them to personal use, I believe they are treated as a sale. With zero as basis and FMV as sales price, there would be a small profit on each item.
    OR are they distributed to the shareholder as his equity in the s corproation? (I don't know if that question even made sense)

    I didn't see anything in TTB small business about liquidating s corps. If I missed it, please point me in the right direction.

    Linda, EA

    #2
    Hi Linda - they are distributed at FMV, with that being the sale price.

    Comment


      #3
      If there is a loss on investment in corp that would be a Capital L/T Loss Schedule D 1040.
      This post is for discussion purposes only and should be verified with other sources before actual use.

      Many times I post additional info on the post, Click on "message board" for updated content.

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        #4
        That is an interesting thought. I will have to look at that closer.

        Linda, EA

        Comment


          #5
          Bob W

          Could you elaborate on your statement about the loss on the investment please?

          S corp shows profit for 2010, if that figures into the equation.

          Linda, EA

          Comment


            #6
            Any investment that effects Basis in the corporation. Capital stock, Loans from Shareholders are 2. Any outside basis is another. All should be on the shareholder Basis Report.
            This post is for discussion purposes only and should be verified with other sources before actual use.

            Many times I post additional info on the post, Click on "message board" for updated content.

            Comment

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