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View Full Version : How do I transfer ownership of Sole Proprietorship? NEED QUICK HELP


ChristianJ318
10-20-2010, 01:47 PM
I searched the internet and the forums here and didnt find any help that applied to my situation. I have a very small Sole proprietorship business with no assets that I run from home. I would like to transfer ownership to my wife ASAP!. The only paperwork that was originally required was a occupational license and filing the trade name with Clerk's office. I did acquire an EIN number but I do not have any employees.
We are trying to buy a new truck and unfortunately, I have some old credit issues so the new purchase will have to be under my wife's credit alone. She is a school counselor and doesnt show a lot of income so, the debt to income ratio is raising the rate. If she is able to prove additional income, the credit union will drop the APR a couple of points which makes a $30+ difference each month and a couple thousand over the term of the loan. Ive contacted the Sec. of State, Notaries, and Attorneys trying to get this done and nobody can help. Well an attorney will for a few hundred dollars but that money needs to go towards down payment. I figure there is a form that needs to be filled out and notarized but I dont know what/where the form is.. Can someone please help me with this?? Im in Louisiana if that helps.

Richard Martin
10-24-2010, 11:12 AM
I think your problem is that a sole proprietorship is little more than a job. There is no formal business structure to sell. LLCs and INCs register their business with the state and list their officers, assets etc. You have nothing but a business income deduction on your 1040s. It's just the way it is. Even if you were to form an LLC there still isn't much of value outside of the assets there. In an LLC the company makes the profits and distributes them to the partners. Partners can be added and removed I believe. You still wouldn't have anything to show as income though since it would be a brand new LLC.

Az Gardener
10-24-2010, 11:35 AM
In most states whats yours is hers so she already owns the company with you. If you filed jointly it should be on your tax return.

Richard Martin
10-24-2010, 12:26 PM
In most states whats yours is hers so she already owns the company with you. If you filed jointly it should be on your tax return.

Their problem is he can't be on the loan. They can't use a shared income if he's a part of that income.

ChristianJ318
10-24-2010, 05:49 PM
Their problem is he can't be on the loan. They can't use a shared income if he's a part of that income.

Exactly. I'm really hoping to get this figured out within the next couple of days because this is the only thing holding up the purchase of the new truck. The anticipation is driving me crazy. That new car smell is like crack!

Roger
10-24-2010, 10:07 PM
[QUOTE=ChristianJ318;3766704... The anticipation is driving me crazy. That new car smell is like crack![/QUOTE]

Not wanting to be a fly in the ointment here, but this kind of approach in the past may have been what made for the credit troubles. Are you really sure you want to make this happen, putting you in potential trouble for more credit downgrades in the future?

Since you seem very tight financially, you may wish to pass your ideas and plans across the desk of somebody who can view the matter impartially. They will not have the new smell or anticipation, rather a more objective look.

Please don't take my comments as pejorative, but some friendly reminders that may save you from bigger headaches down the road. We don't know the entire situation, just a small snapshot.

ChristianJ318
10-24-2010, 10:50 PM
Not wanting to be a fly in the ointment here, but this kind of approach in the past may have been what made for the credit troubles. Are you really sure you want to make this happen, putting you in potential trouble for more credit downgrades in the future?

Since you seem very tight financially, you may wish to pass your ideas and plans across the desk of somebody who can view the matter impartially. They will not have the new smell or anticipation, rather a more objective look.

Please don't take my comments as pejorative, but some friendly reminders that may save you from bigger headaches down the road. We don't know the entire situation, just a small snapshot.
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ChristianJ318
10-24-2010, 11:05 PM
Roger, I don't take offense to your comment but we are not too tight on money to make this purchase... The credit union is going on my wifes income and credit alone. They are not considering any income from my two businesses or my third p/t job. I'm not saying that we are wealthy but a car note isn't going to change our way of living. I made mistakes when I was young and single and learned from them. Fortunately we are not one the families you refered to that started the credit crisis.
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ChristianJ318
10-24-2010, 11:16 PM
After reading my original post again, I don't see how you would take it that were financially tight. Essentially it's like were at the dealership and they say xxx is what you'll pay over the course of the loan but if you sign this piece of paper transferring 1/3 of your monthly income to your wife you'll save 2-3,000 at 3.9% interest wouldn't you want to find that piece of paper?
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coolluv
10-25-2010, 07:44 AM
I searched the internet and the forums here and didnt find any help that applied to my situation. I have a very small Sole proprietorship business with no assets that I run from home. I would like to transfer ownership to my wife ASAP!. The only paperwork that was originally required was a occupational license and filing the trade name with Clerk's office. I did acquire an EIN number but I do not have any employees.
We are trying to buy a new truck and unfortunately, I have some old credit issues so the new purchase will have to be under my wife's credit alone. She is a school counselor and doesnt show a lot of income so, the debt to income ratio is raising the rate. That would be one reason. If she is able to prove additional income, the credit union will drop the APR a couple of points which makes a $30+ difference each month and a couple thousand over the term of the loan. That would be strike two. Ive contacted the Sec. of State, Notaries, and Attorneys trying to get this done and nobody can help. Well an attorney will for a few hundred dollars but that money needs to go towards down payment. Strike three. I figure there is a form that needs to be filled out and notarized but I dont know what/where the form is.. Can someone please help me with this?? Im in Louisiana if that helps.



Those could be the reasons.

Dave...

ChristianJ318
10-25-2010, 10:30 AM
I guess I couldve phrased my post differently but I never thought someone would conclude that I'm getting in over my head financially from it. And the comment I made about the new car smell was supposed to be a joke. And I when I said the attorney money should go to down payment, it isn't because of necessity. The truck I'm looking at is $37,690 but I will be paying less than $390 mo from the amount I put down on it and negotiating the price. Again, I'm not saying that I'm rich by any means just not jumping in over my head.
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Stillwater
10-25-2010, 11:10 AM
I'm not saying that I'm rich by any means just not jumping in over my head.Posted via Mobile Device

This is a depressing post so be warned......
A business that can afford a capitol purchase like this and commit to a recurring monthly note will show a more significant amount of deposits over withdrawals. Their will be clear documentation of this on bank statements and evidenced by decent and reasonable balances in checking and savings accounts. You will be better served by seeking out a lawyer and paying his paltry fee for completing the paperwork that amounts to only 1 of those monthly payments. if the lawyer fee is not available then the monthly truck payment is not either. Understanding this takes a brutal amount of personal internal honesty. lawyer up.......

cgaengineer
10-25-2010, 11:14 AM
Why not just by the truck if you want it, and transfer ownership of company later and refinance.
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