USA Transfer of Assets between 2 Sole Proprietorships

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Hi there,

I tried to do a search on the forum, however, I couldn't seem to find a specific answer to my situation...

I have a small item specific business which is a sole proprietorship. Earlier this year I decided that I wanted to close this business, so I began to sell off my inventory.

Meanwhile I have a started a new small business, in which I resell anything I can get my hands on to make a profit. The assets that I used with the prior business I have been using with the new business, so I would like to transfer those assets to my new business.

In addition I also wanted to transfer all of the leftover inventory to my new business, considering I could continue selling the left over inventory with my new business. I'm having a difficult time maintaining accounts and books for the two separate businesses, and would like to simplify this process by transferring everything to the new business (both currently sole proprietorships).

What steps do I need to do to make this happen? Would I have to sell everything from business A to business B?

Thank you for any advice you can give!!

Jenn
 

kirby

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You will need to see what the sales tax law is in your jurisdiction. Some let intercompany sales (from your old company to your new company) happen at no sales tax and some place a sales tax on this (Yikes). And if the latter case- then you do not sell from A to B - just sell everything out of A till its all gone.
 

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