TAXMAN Posted May 4, 2009 Report Share Posted May 4, 2009 Father and son partnership. Father wants to sign over his interest for $1.00 to son and get out of business. He is 70. Should we convert this to an LLC first or let dad sign over. Disolve it out and continue as a sole propietrship? Any ideas on this will be appreciated. All debt by the parternership have been personally guaranteed by the son. Many thanks. Quote Link to comment Share on other sites More sharing options...
mcb39 Posted May 4, 2009 Report Share Posted May 4, 2009 File a final return for the Partnership through the date that the Father wants out. From that date on, convert to Schedule C sole proprietorship. Unless there is something in the Partnership agreement which negates this; just disolve the Partnership and then create an LLC for the Son if that is what he wants; Sch C; disregarded entity. See Pub 544 for special rules that apply to the sale or trade of property between related parties. Quote Link to comment Share on other sites More sharing options...
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