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PDtax, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 4511
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: 1 year ago.
Category: Tax
Expert:  PDtax replied 1 year 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 1 year 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 1 year ago.