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I sold the business assets in an installment sale. Proceeds…

I sold the business...

I sold the business assets in an installment sale. Proceeds were:

Accountant's Assistant: The Accountant will know how to help. Please tell me more, so we can help you best.

Proceeds were 185000 in inventory, 40000 in FF&E, 335000 in goodwill / intangibles for a total of 560k. I don't think I should have to report / pay taxes on the inventory. How should I lay this out on the forms 6292 and 4797?

Accountant's Assistant: Is there anything else important you think the Accountant should know?

I received $145k at closing and financed $360k over the next 7 years.

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Answered in 29 minutes by:
1/2/2018
PDtax
PDtax, Certified Public Accountant (CPA)
Category: Tax
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Experience: 35 years tax experience, including four years at a Big 4 firm.
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I need a bit more background to advise.

Typically, the corporation that opened the assets sells everything and then the owner takes the note and cash in liquidation.

In that case, the corp reports final income after expenses, then the owner reports their gain or loss.

Please confirm your structure in sale.

PDtax
PDtax, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 5,067
Experience: 35 years tax experience, including four years at a Big 4 firm.
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Customer reply replied 5 months ago
S-Corp. I am only concerned with how to handle the inventory. The contract price for the asset sale was $475k with $100k of inventory. At closing, it was determined the inventory was actually $185k. Should the selling price on form 6252 be $475k or $375k? I already paid for the inventory, so I don't think the $185 should be taxed.
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