Question

Closing sole proprietorship. How do I report remaining inventory?

Forum|Forum|5 years ago
May 13, 2021
1 reply
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Im closing my sole proprietorship. How do I report remaining inventory? Remaining is under 2k worth. Ive seen some forum Q&A about donations, but nothing for when the inventory has not been donated. The business is costing me money and I just want to finally be done with it.

Not A Product Question

M

Mike9241

physical disposal of the inventory is required even if damaged or worthless. you can throw it in the trash or donate it to charity. give it to friends or use it yourself then you need to use the line in the cost of goods sold section - withdrawn for personal use. if you have already expensed it under the cash basis of accounting, you could have income if you use it personally or give it to friends.

it may also depend on the method you use for valuing ending inventory like 33 on schedule C in the cost of goods sold section.

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