I have been operating a small business for the past few years reporting on Schedule D. I incorporated in August this year and was granted S-Corp status. As far as 1999 taxes are concerned, do I file Schedule D to cover the business from Jan-Aug and then 1120S for Aug-Dec? My fiscal year for the S-Corp is the normal Jan-Dec.
Your assumptions are correct except for one thing. The sole proprietor form is Schedule C (not Schedule D, which is the form used to report capital gains). January to August will go on the Schedule C; August thru December will go on teh 1120S.Regards,Gregg SeaPA
Thanks for the reply. I knew it was schedule C but I must have had a brain brown out. Another question, can the loss on the sale of a timeshare be deducted using schedule D?Jeff
One other point to add--Be careful what you put into the corporation. Once appreciated property is contributed to the corporation, it can not be taken out with having to pay taxes on the gain.Had a client put real estate into the S-corporation and I explained the consquences of do it. Six months later , they decided to get rid of the corporation and the IRS made a killing. The property had to be treated as if it was sold for FMV and gain was passed through to the shareholder.Costly decision on their part.
If the timeshare was your personal property, you can't deduct any loss. If it was a business asset you would have the potential for deducting a loss.
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