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Category: Tax
Satisfied Customers: 9747
Experience:  Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
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My client sold her s corp for $360k. The allocation was $60k

Customer Question

My client sold her s corp for $360k. The allocation was $60k for all assets and $300k for goodwill. the book values for all assets is zero.
I am preparing her 1120s and 1040 but have problem with the following.
1.assets $60 k will be reported on 4797 but not sure which part? part I or II or III
2.Good will reported on 8949 on 1040 or 1120s return? on part II?
Submitted: 6 months ago.
Category: Tax
Expert:  Lane replied 6 months ago.
1120 is irrelevant here ... As I pointed out on your earlier question, this is a sale of assets by the Owner....The sale of goodwill depends on whether the goodwill was purchased or created. Created goodwill is reported on schedule D. Purchased goodwill is reported on 4797 part 3....Use the categorization I gave you on the previous question - in terms of what part. (Part II for ordinary gains - recapture of depreciation or amortization goes on part three (1245 property))
Expert:  Lane replied 6 months ago.
Did you see my answer?...I'd appreciate a positive rating (using the faces or stars on your screen, and then clicking “submit")...JustAnswer will not credit me for the time and work until you have rated in this way....Thank you!Lane