Sale of Business Asset, C-Corp

[geekgirldany]

Client passed away in Nov 05 he had C-Corporation. We renewed with secretary of state for 2006 until a final payment was received. I am waiting until after 4/15 to do the closing/dissolve the C-Corp.

Wife is now selling van that was in the C-Corp. She is wanting to know weather to have the check wrote to her or corporation. I told her corporation at first but now says someone told her that wasn't right. I thought write to the corporation and then the money would be transferred to her when dissovled. What do you guys think?

[BOB W]

Sale

the sale of all corporate assets should flow through the corporation.............

[OldJack]

She does not own the van as the corporation owns the van if its on the corporation books. The corporation must report the sale and recognize gain or loss on form 4797 and pay any C-corp tax. Then the money can pay corporate debts or be distributed in liquidation with the shareholder paying tax on their gain, thereby the old double tax.

If she keeps the money the corporation still has to recognize any gain/loss on a sale to her at FMV which would be the actual sale price.

[geekgirldany]

Thanks you guys that is what I thought but thought I would double check. She said the guy buying the truck said she didn't have to put it through the corporation. I just called her and she said she told him to put it in in her name. Says she will turn around and put the money in the corporation.

I'm going to work with a local CPA to help me close down the C-Corp to make sure everything is done right and she will know what tax will have to be paid.