Discussion:S Corp bankruptcy
From TaxAlmanac
| Revision as of 23:15, 4 June 2008 RoyDaleOne (Talk | contribs) (Question one was) ← Previous diff |
Revision as of 17:31, 12 September 2009 FLAcct (Talk | contribs) (I have a similar) Next diff → |
||
| Line 27: | Line 27: | ||
| }} | }} | ||
| + | |||
| + | {{ForumReplyPost|UserID=FLAcct|Date=12 September 2009|Text=I have a similar situation as Tcaccounting and need help with the following: | ||
| + | |||
| + | Does the Cancellation of Debt amount get put on Schedule M-1? It's got to go somewhere and that's the only place I can think to put it (as tax-exempt income). | ||
| + | |||
| + | Also, back to the Tcaaccounting's question 1), I don't understand the answers given to this question. These assets that were repoed need to come off the books somehow and there will be a loss because there still is some net book value to these assets. I can't think of how to get rid of them but put them on a 4797. | ||
| + | |||
| + | Any help you can give would be greatly appreciated.}} | ||
Revision as of 17:31, 12 September 2009
Discussion Forum Index --> Advanced Tax Questions --> S Corp bankruptcy
Discussion Forum Index --> Tax Questions --> S Corp bankruptcy
Tcaccounting (talk|edits) said: | 3 June 2008 |
| Here's the situation:
My client operated a restaurant/s-corp which was forced to close. They had an SBA loan, 2 credit cards, and a business loan, all of which were discharged in bankruptcy. The physical assets of the corporation were security for the SBA loan, so the bank repoed the store itself. I have read the IRS Bankruptcy Tax Guide, and know all about the reduction in tax attributes. In this case, the only tax attributes available are basis in its remaining assets. I have a couple technical questions on how to report this info. As an FYI, I use CS Ultratax. 1) Disposal of the assets used to secure the SBA loan. Do I just put them "out of service" or "retired"? I don't think that doing a disposal would be the best option, as this would generate a form 4797. I know I need to put the excluded income from discharge of debt on Form 982. 2) The intangible assets would be all that remains after the bankruptcy. The bankruptcy tax guide says to reduce the tax attributes in the tax year following the discharge of indebtedness. The bankruptcy occurred in 2007. So do I do the 2008 return (which will be the final return) and adjust the cost of the intangible assets? I hope this makes sense. If not, please let me know. Thanks for all your help! Ben | |
| 4 June 2008 | |
| Don't forget to reduce the suspended loss carryovers (suspended due to basis limitations). | |
RoyDaleOne (talk|edits) said: | 4 June 2008 |
| Good, except for the fact you have no assets to dispose. | |
RoyDaleOne (talk|edits) said: | 4 June 2008 |
| Question one was "1) Disposal of the assets used to secure the SBA loan. etc.", about disposal.
Question two was about intangible assets see Riley2 answer and your answer Tcaccounting. I quess I need to be very specific in my answers. | |
| 12 September 2009 | |
| I have a similar situation as Tcaccounting and need help with the following:
Does the Cancellation of Debt amount get put on Schedule M-1? It's got to go somewhere and that's the only place I can think to put it (as tax-exempt income). Also, back to the Tcaaccounting's question 1), I don't understand the answers given to this question. These assets that were repoed need to come off the books somehow and there will be a loss because there still is some net book value to these assets. I can't think of how to get rid of them but put them on a 4797. Any help you can give would be greatly appreciated. | |
