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PDtax, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 4200
Experience:  35 years tax experience, including four years at a Big 4 firm.
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Transfering assets that have accum deprec from a sole prop

Customer Question

Transfering assets that have accum deprec from a sole prop to an "S" corp - do I use adjusted basis and continue with same depreciation schedule or use FMV and start a new deprec schedule - that doesn't seem right
JA: The Accountant will know how to help. Anything else I can tell the Accountant before I connect you two?
Customer: No - I was advised by a CPA that you have to use FMV as the basis and set up a shareholder's loan to record the transaction but I disagree on that entry?
JA: I'm sending you to a secure page on JustAnswer so you can place the $5 fully refundable deposit now. While you're filling out that form, I'll tell the Accountant about your situation and connect you two.
Submitted: 10 months ago.
Category: Tax
Expert:  PDtax replied 10 months ago.
Hi from Just Answer. I'mCustomer I'll assist. You use carryover basis and depreciation method for the assets you transfer over. In fact, you can't sell assets to your S corp at a gain, which is what the other advice you received would have required. same depreciation schedule, with the switch year depreciation expense divided up between the C and S corp. Thanks for asking at Just Answer. Positive feedback is appreciated whe you accept my response. If you need anything more, please ask. I'mCustomer
Customer: replied 10 months ago.
Is this acceptable: op cash in bank 10,000: assets using adjusted basis 300,000: stock 10,000 and additional pd in capital 300,000.?
Expert:  PDtax replied 10 months ago.