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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.
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.
To answer your questions specifically:
1. If you buy it for a small fee, you will not be taxed on the purchase.
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.
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.
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.
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.
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.
You should also discuss fees with your accountant so that there are no surprises down the road.
I'll leave you my contact information in case you want to reach me again.
I do have one more question
Would I have to have an attorney or would we be able to transfer ownership on our own?
It depends upon what you are buying.
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
Well, is the owner operating as a sole proprietorship? Do you work there now?
yes she is and I volunteer there now
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.
HaHaha --Thank you for you help!
A preschool is not the best to operate as a sole proprietorship.
Is this school officially licensed?
I believe that you will need to qualify to run the school?
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.
Well, I'm sure the rules are somewhat different in each state; I know in Mass where I am they are pretty strict.
It may be to your benefit to get licensed at some point.
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.
I will definitely find an accountant before I go any further
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.
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
ok, I'll leave my contact info; I work in the Tax, & Finance categories here.
Thanks very much, Steve G.
Thanks for using JustAnswer.com
Have a great day/night
& good luck