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What form do I use for a dissolution of an asset on 1120S?

WTM
Level 2

I'm closing an S Corp in dissolution on a short year for 2020. There is only a single asset that which was a franchise fee that has been amortized over 10 years. It never used section 199A so there is no recapture necessary. The single shareholder is dissolving the business, not selling it so would I use form 4562 and show zero income received?

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sjrcpa
Level 15

4797 with sale price -0-.

File Form 966.

That fee should probably have been amortized over 15 years.


ex-AllStar

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7 Replies 7
sjrcpa
Level 15

4797 with sale price -0-.

File Form 966.

That fee should probably have been amortized over 15 years.


ex-AllStar

View solution in original post

WTM
Level 2

Thank you. The fee was amortized over 15 years. This year is 10 of the 15 years.

The 966 has been mailed. Do I still file it with the return? 

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sjrcpa
Level 15

I'm not sure. I don't do them often. What do the instructions say?


ex-AllStar
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WTM
Level 2

That's what I was following. Thank you. 

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JJK
Level 3

Due to the backlog of IRS, I will be e-filing Form 966 along with the tax return to be on the safe side.  However, I will add a note saying a paper form 966 was mailed MM/DD/YY.   

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WTM
Level 2

Thank you, JJK and sjrcpa. I appreciate your assistance.

sjrcpa
Level 15

You're welcome.


ex-AllStar
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