How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.

Ask Stephen G. Your Own Question

Stephen G.
Stephen G., Sr Income Tax Expert
Category: Tax
Satisfied Customers: 4190
Experience:  Extensive Experience with Tax, Financial & Estate Issues
30050794
Type Your Tax Question Here...
Stephen G. is online now
A new question is answered every 9 seconds

I am taking over ownership of a small preschool in NY my questions

Resolved Question:

I am taking over ownership of a small preschool in NY my questions are--If I buy it for a very small fee do I get taxed on it, If it is given to me do I pay taxes on it?
Once I own it I will have one employee other than myself--How do I do payroll and know what taxes are taken out, do I have to pay disability and workman comp? Do I need an accountant to help me with this and how do I find one?
Submitted: 1 year ago.
Category: Tax
Expert:  Stephen G. replied 1 year ago.

Stephen G :

Hi & thanks for using our service. I'll do my best to give you a complete & accurate answer. Please ask me to clarify anything that is not clear.

Stephen G :

From the nature of your questions, I think you will really benefit from having an accountant on board. I definitely recommend that you seek the advice of a local CPA before you actually purchase the preschool. For one thing you need to determine what the best way to conduct business is; ie. the form of doing business is very important and that affects many aspects of conducting business and particularly the type of liability insurance that you should carry.

Stephen G :

To answer your questions specifically:

Stephen G :

1. If you buy it for a small fee, you will not be taxed on the purchase.

Stephen G :

2. If it is given to you there would also be no tax to you. It may require a gift tax return by the donor, but it is doubtful any gift tax would be due.

Stephen G :

3. The best alternative to comply with the payroll requirements is to have a service bureau take over the payroll; the payroll reporting gets very involved and when something is done incorrectly, it is a nightmare to get it straightened out; there are penalties involved and if you engage a service bureau, they would have to stand behind their work and pay any penalties.

Stephen G :

If you speak with an accountant, preferably a local CPA, he or she can recommend a local service. Depending upon how you organize the business, you may need to be on the payroll as well as your employee.

Stephen G :

Again, you need an accountant. The best way to find one in your local area is to visit the NY Society of CPAs website and they have a referral service so you will be able to find a CPA, who is a member of the state society, meets certain practice requirements, and is interested in serving additional businesses.

Stephen G :

You might also ask your bank or attorney for a recommendation or ask them about the referrals in your area and see what they say or if they know of the CPA's work or clients, etc.

Stephen G :

You should also discuss fees with your accountant so that there are no surprises down the road.

Stephen G :

Questions?

Customer:

Thank you

Stephen G :

I'll leave you my contact information in case you want to reach me again.

Customer:

I do have one more question

Stephen G :

ok

Customer:

Would I have to have an attorney or would we be able to transfer ownership on our own?

Stephen G :

It depends upon what you are buying.

Customer:

Well everything in the school comes with ownership as well as the name--tables, chairs books, supplies etc. The owner actually just wants to give me the school and not make me pay anything-the space is rented

Stephen G :

Well, is the owner operating as a sole proprietorship? Do you work there now?

Customer:

yes she is and I volunteer there now

Stephen G :

I would recommend that you engage a CPA first, & he'll be able to refer you to an attorney if you need one & he'll have an attorney that he can send you to that he's worked with and that won't charge you an arm & two legs.

Customer:

HaHaha --Thank you for you help!

Stephen G :

A preschool is not the best to operate as a sole proprietorship.

Stephen G :

Is this school officially licensed?

Stephen G :

I believe that you will need to qualify to run the school?

Customer:

The school is not licensed however it is only opened for 3 hours a day which falls under different rules, it does not have to be. Childcare/school less than 3 hours is different.

Stephen G :

Well, I'm sure the rules are somewhat different in each state; I know in Mass where I am they are pretty strict.

Stephen G :

It may be to your benefit to get licensed at some point.

Customer:

I actually already looked into it for NY because I was concerned myself--I am degreed in education but not early childhood so I needed to find that information out first.

Customer:

I will definitely find an accountant before I go any further

Stephen G :

There's a lot to it I know, but liability wise you probably need some protection other than what you can buy; it doesn't take much for one kid to whack another one & put his eye out & then nightmare on Elm Street for you.

Customer:

Well that makes me feel good....... I know the school does have insurance. I see that I have a lot to look into. You have helped me and given me more to think about--Thank you

Stephen G :

ok, I'll leave my contact info; I work in the Tax, & Finance categories here.

Stephen G :
If you need to contact me again with any tax or financial questions, you can just ask for "Steve G" at the beginning of your question. Again, please remember to rate my response. Bonuses, where you think they are warranted, and excellent ratings, are always most appreciated. Thanks again for using JustAnswer.com.

You may get a short survey from the site; if it isn't too much trouble I would appreciate it if you would answer it; the survey results are used to rate our performance;

Thanks very much, Steve G.

Customer:

perfect--Thanks!

Stephen G :

Thanks for using JustAnswer.com

Customer:

Have a great day/night

Stephen G :

U2

Stephen G :

& good luck

Stephen G., Sr Income Tax Expert
Category: Tax
Satisfied Customers: 4190
Experience: Extensive Experience with Tax, Financial & Estate Issues
Stephen G. and 6 other Tax Specialists are ready to help you

JustAnswer in the News:

 
 
 
Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.
 
 
 

What Customers are Saying:

 
 
 
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
< Last | Next >
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
  • I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight. Bonnie Chesnee, SC
  • Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation. John Minneapolis, MN
  • Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with. Orville Hesperia, California
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C. Freshfield, Liverpool, UK
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex Los Angeles, CA
  • Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP Hesperia, CA
 
 
 

Meet The Experts:

 
 
 
  • Wallstreet Esq.

    Tax Attorney

    Satisfied Customers:

    570
    10 years experience
< Last | Next >
  • http://ww2.justanswer.com/uploads/KU/KUMI95/2013-9-30_195031_kumar.64x64.jpg Wallstreet Esq.'s Avatar

    Wallstreet Esq.

    Tax Attorney

    Satisfied Customers:

    570
    10 years experience
  • http://ww2.justanswer.com/uploads/CU/Cuttinggirl/2011-10-29_03719_wcrop2.64x64.jpg Wendy Reed's Avatar

    Wendy Reed

    Enrolled Agent

    Satisfied Customers:

    3052
    15+ years tax preparation and tax advice.
  • http://ww2.justanswer.com/uploads/CATax/2009-08-04_204548_Mark.jpg Mark D's Avatar

    Mark D

    Enrolled Agent

    Satisfied Customers:

    985
    MBA, EA, Specializing in Business and Individual Tax Returns and Issues
  • http://ww2.justanswer.com/uploads/IN/insearchoftheanswer/2013-8-16_0233_attorney.64x64.jpg Richard's Avatar

    Richard

    Tax Attorney

    Satisfied Customers:

    3229
    29 years of experience as a tax, real estate, and business attorney.
  • http://ww2.justanswer.com/uploads/MY/MyVirtualCPA/2012-7-5_44024_cookmegan1.64x64.jpg Megan C's Avatar

    Megan C

    Certified Public Accountant (CPA)

    Satisfied Customers:

    6121
    Licensed CPA, CFE, CMA who teaches accounting courses at Master's Level
  • http://ww2.justanswer.com/uploads/JG/jgordosea/2012-6-7_43138_GordosVeritas.64x64.jpg jgordosea's Avatar

    jgordosea

    Enrolled Agent

    Satisfied Customers:

    2783
    I've prepared all types of taxes since 1987.
  • http://ww2.justanswer.com/uploads/OZ/ozaukeecpa/2012-6-7_193219_Picture1croppedandshrunk.64x64.jpg MequonCPA's Avatar

    MequonCPA

    Certified Public Accountant (CPA)

    Satisfied Customers:

    2231
    CPA, Over 30 yrs experience w/individuals and small businesses. Masters in Tax.
 
 
 
Chat Now With A Tax Professional
Stephen G.
Stephen G.
Sr Financial & Tax Consultant
3651 Satisfied Customers
Extensive Experience with Tax, Financial & Estate Issues