Sale of Business

[S T]

Form 1065 h/w sells business, assets such as vehicle and equipment no problem on reporting,

Question on how to report

$55,000 for self created goodwill, customer list so it will be calculated at the capital gain rate.

Is the goodwill, customer list amount reported on Schedule D with cost basis of -0-?

Or is it reported on form 4797, Part ??

Thanks

Sandy

[Roland Slugg]

Schedule D

Yes, report the sale of goodwill on Schedule D (F-1065). From there it flows directly to Schedule K and Schedules K-1. The basis is usually zero for self-created goodwill, unless costs had been allocated thereto in the past.

[S T]

Thanks

Many thanks, thought so, as that seemed to be the only way to achieve the capital gain treatment. Zero basis.

Sandy