I have a client that sold their S-Corp assets, goodwill & going concern.
The sale was December 29, 2022. No money was received in 2022.
The sale price was $234,287
Assets $25,000
Receivables $24,287
Going Concern/Goodwill $185,000
The undepreciated assets as of 12/29 are $73,187 (mostly undepreciated Leasehold improvements)
Considering no cash was received in 2022, I am assuming an installment is appropriate.
But.... do I have a reportable loss on the fixtures, equipment and leasehold improvements for 2022? Or would I allocate some of the basis to the $185,000? I am not sure how to do this in Proseries.
Any advice is appreciated.
Fixed Assets are Assets. Assets sold for $25,000. Basis 73,187. Sounds like a loss to me.
The receivables sale is reportable on 2022. Not eligible for installment sale treatment.
For reference: "Or would I allocate some of the basis to the $185,000?"
No. It's already allocated and agreed upon between buyer and seller. It is what it is. It's the intangible part and is treated differently than the tangible part(s).
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