Discussion:Unreturned Bank CD
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Discussion Forum Index --> Basic Tax Questions --> Unreturned Bank CD
Discussion Forum Index --> Tax Questions --> Unreturned Bank CD
| 22 April 2008 | |
| Client sold her business to a new owner. Her business was in an LLC which has formally dissolved. Prior to selling the business and dissolving the LLC, the bank had given them a loan and the proceeds were held in a CD at the bank. The bank has refused to give the money back to my client since the deal is still pending with the new owner. The LLC has dissolved in the meantime and I am wondering how to treat this pending issue with the CD that the bank is holding. Could it be considered a capital loss -- then if the client later receives the money, report it as income? | |
RoyDaleOne (talk|edits) said: | 22 April 2008 |
| Was this a single member LLC?
The facts are too muddled, please clarify. Sounds, like your client pledged the CD as collateral for a loan. Is this correct? | |
| 22 April 2008 | |
| No -- it was a partnership. The client did pledge the CD as collateral and since the new owner has not completed the transaction in terms of transferring title for the franchise to his name, the bank has not released the CD. In fact, the franchise has not officially been sold as a result and the LLC members are still holding the franchise (even though the LLC which owned the franchise has been dissolved.) | |
RoyDaleOne (talk|edits) said: | 22 April 2008 |
| Why do you think the client has a deductible loss? | |
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