cancel
Showing results for 
Search instead for 
Did you mean: 
Highlighted
Experienced Member

If the business is closing, how do I handle the shareholder notes payable account? trying to do last tax return and not sure how to show this? any help will be great

 
1 Comment
Established Community Backer ***

Re: If the business is closing, how do I handle the shareholder notes payable account? trying to do last tax return and not sure how to show this? any help will be great

In practical terms you should liquidate or pay out the shareholder notes payable to the shareholders to make them whole before closing the business. Or you may have to convert the payables to equity. If the business is closing due to insolvency then unless it is declaring bankruptcy the shareholders might individually be responsible for final debt resolution of the business.

 

Not a good idea to file a final tax return based on free internet advice, even if it is from me, lol. You should find enough final funds to hire a cpa for this