- Jurisdiction
- California
Hello everyone,
I'm going to try to make this story as short as possible:
I have a friend right before the 2020 Covid Pandemic asked me for help in regards to his business. He needed someone to legally take over his business because for some reason, he can't be the owner anymore. Without knowing Covid would hit, I agree to be the legally owner of his business where we did the sales contract, form a new corp, etc.
When Covid hit, the business was impacted financially so to keep the business going, my friend had to put his own personal funds into the business. So now, as I am the legal owner, the corporation/business owes my friend a huge sum of money since he inserted his personal funds into the business.
I did not like this at all because as the legal owner, the business/corporation now owes my friend a huge sum of money as filed on the tax returns. Moreover, it gave me a bad tax return since we had to file losses.
So my question is:
I want to square everything out and sell the business back to him so that I no longer am associated with the business/corporation but if I do so, on the tax returns it'll still state that my corporation owes him money. He said the only way to resolve this issue is for my business/corporation to pay him back the money that he put in during the pandemic.
Is there any other way where I can free and clear my name of the corporations/business because I don't want to be the one at risk anymore. I was thinking that I can "gift" him the business back and clear the debt that the corporation owes him but I'm not sure if that'll work.
I feel like this is a way for him to keep me here to help him longer.
If I knew Covid was coming then I would've never agreed to help him in the first place.
Thanks for the suggestions/answers.
I'm going to try to make this story as short as possible:
I have a friend right before the 2020 Covid Pandemic asked me for help in regards to his business. He needed someone to legally take over his business because for some reason, he can't be the owner anymore. Without knowing Covid would hit, I agree to be the legally owner of his business where we did the sales contract, form a new corp, etc.
When Covid hit, the business was impacted financially so to keep the business going, my friend had to put his own personal funds into the business. So now, as I am the legal owner, the corporation/business owes my friend a huge sum of money since he inserted his personal funds into the business.
I did not like this at all because as the legal owner, the business/corporation now owes my friend a huge sum of money as filed on the tax returns. Moreover, it gave me a bad tax return since we had to file losses.
So my question is:
I want to square everything out and sell the business back to him so that I no longer am associated with the business/corporation but if I do so, on the tax returns it'll still state that my corporation owes him money. He said the only way to resolve this issue is for my business/corporation to pay him back the money that he put in during the pandemic.
Is there any other way where I can free and clear my name of the corporations/business because I don't want to be the one at risk anymore. I was thinking that I can "gift" him the business back and clear the debt that the corporation owes him but I'm not sure if that'll work.
I feel like this is a way for him to keep me here to help him longer.
If I knew Covid was coming then I would've never agreed to help him in the first place.
Thanks for the suggestions/answers.
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