"DolphinVJ" <SharmaV[at]Sutterhealth.org> wrote:

- quote -

sounds like a liquidation of the business and the assets
distributed to the owners. the fact that the assets are
sitting in storage is just what the owners happen to be
doing with them (i.e., letting them sit idle). as I've
stated in prior posts to you on this and/or related matters,
you're asking questions that are very fundamental to the
sale or liquidation of a business, you really ought to seek
competent, professional guidance so that you don't miss
anything that could come back to haunt you. this is not
limited to tax questions but a range of business, entity,
liability and risk issues.

- quote -

you don't give sufficient info but as stated above so it's
impossible to know, but this sounds like a liquidation

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Mark,

Thanks for the reply.

One question I have to your answer for Scenario #1 -

Please explain how this is a distribution of assets to the
partners when the assets (70% remaining) are placed in
storage.

If this is indeed a distribution to the partners, would
these assets be netted against the capital of the partners
since no cash is involved in this distribution? Would this
in essence be a liquidation as opposed to a sale of
business?

Is Form 8594 filed only upon sale of a business and not for
liquidation?

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"DolphinVJ" <SharmaV[at]Sutterhealth.org> wrote:

- quote -

No, this is not a sale but rather a distribution of assets
to the owner(s) which may or may not be a taxable
transaction to the restaurant and/or the owners depending on
a number of factors which were not given in your info.

- quote -

Assuming the 30% of assets sold went to an independent
third-party purchaser (i.e., not one of the owners or other
related party), then a 4797 is required but not an 8594.

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30% of the Assets have been sold and the operations of a
partnership restaurant business have been shut down.

1. If the rest of the business assets is placed in storage
and another restaurant business is not opened, does this
constitute a sale of business? Are Forms 8594 and Form 4797
required to be filed.

2. If another restaurant business is started in another
location with the rest of the 70% assets, does the sale of
30% of assets require, as part of sale of business property,
Forms 8594 and Form 4797?

I would think 4797 is required in either case.

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >