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The CBS-1 form is an essential document for anyone involved in the sale, purchase, or transfer of business assets in Illinois. When a business owner decides to sell or transfer a significant portion of their assets—such as inventory, furniture, machinery, or real estate—they must complete this form. It serves as a formal notice to the Illinois Department of Revenue. Timeliness is crucial; forms submitted more than ten days after the sale date will not be processed. The form not only identifies the business and its assets but also details the seller and purchaser, including their respective identification numbers. It's important to note that the purchaser or transferee could be held liable for any debts incurred by the seller. The CBS-1 also captures the terms of the sale, whether it’s a cash transaction or involves financing, ensuring all parties are aware of their obligations. For assistance, individuals can contact the Chicago office during business hours. Completing and submitting the CBS-1 form accurately is vital to avoid potential liabilities and ensure compliance with state tax laws.

Sample - Cbs 1 Illinois Form

Illinois Department of Revenue
CBS-1 Notice of Sale, Purchase, or Transfer of Business Assets
General information
You (or the purchaser or the transferee) must complete Form CBS-1
if, outside your usual course of business, you sell or transfer the
major part of the
• stock of goods that you are in the business of selling,
• furniture or fixtures,
• machinery and equipment, or
• real property of your business.
Forms received more than 10 days after the sale date will not be pro-
cessed. The purchaser or transferee may be held liable for any debt
incurred by the seller.
Part 1: Identify the business being sold or transferred and the identification numbers
1 ____________________________________________________ 3
_______________________________________
Business name Illinois business tax number (IBT no.) or account identification number
2 ____________________________________________________ 4
___ ___-___ ___ ___ ___ ___ ___ ___ ___ ___ ___
Street address Federal employer identification number (FEIN) Seq. number
____________________________________________________ 5
___ ___ ___-___ ___-___ ___ ___ ___
Street address (if needed) Social Security number
____________________________________________________
6 Are you required to pay any excise taxes
?
Yes
No
City State ZIP
Excise tax number
________________________________________
Part 2: Identify the seller or transferor
7 ____________________________________________________ 9 __________________________
Name Daytime phone number
8 ____________________________________________________ 10 ____________________________________________________
Home or mailing address Name of seller’s or transferor’s attorney Daytime phone number
____________________________________________________ 11 ____________________________________________________
City State ZIP Address of attorney
Part 3: Identify the purchaser or transferee
12 ____________________________________________________ 14 ____________________________________________________
Name Purchaser’s or transferree’s IBT no. and FEIN
13 ____________________________________________________ 15 ____________________________________________________
Home or mailing address Name of purchaser’s or transferee’s attorney Daytime phone number
____________________________________________________ 16 ____________________________________________________
City State ZIP Address of attorney
Part 4: Describe the terms of sale or transfer
17
Date business was or will be sold or transferred.
___/___/____
21 Terms of sale or transfer. Write “X” in the appropriate box, and
Month Day Year
provide additional information as requested.
18 Selling price of the business or the value of the business Cash sale
assets transferred: $ ____________________ Contract sale. Complete the following information:
19 Was the entire business sold or transferred? • Down payment amount: $ ____________________
Yes • Monthly payment amount: $ ____________________
No - You must complete Line 20. • Date last payment is due
___/___/____
20 Are the seller’s or transferee’s registration numbers with the
Month Day Year
department to remain active? Conventional financing
Yes Other (Specify.): ____________________________________
No - Write the date to be discontinued.
___/___/____
_________________________________________________
Month Day Year
_________________________________________________
Part 5: Sign below. This must be completed by the person submitting this Form.
22 ____________________________________________________ 24 ____________________________________________________
Print or type your name Daytime phone number
Signature Date
23 ____________________________________________________
Mailing address of person
This form is authorized as outlined by the Illinois Income Tax Act [35 ILCS 5/902] and the Retailers’ Occupation Tax Act [35 ILCS 120/5j]. You are required to report all sales
of businesses to the Illinois Department of Revenue. Disclosure of this information is REQUIRED. Failure to provide such information may result in the purchaser or transferee
becoming personally liable for the amount of tax owed by the seller. This form has been approved by the Forms Management Center. IL-492-4224
CBS-1 (R-4-09)
If you need additional information, you may call our Chicago office
weekdays between 8:30 a.m. and 5:00 p.m. at 312 814-3063.
Mail your completed Form CBS-1, a copy of the sales contract, and
financing agreement to:
BULK SALES UNIT
ILLINOIS DEPARTMENT OF REVENUE
100 WEST RANDOLPH LEVEL 7-400
CHICAGO IL 60601
You may fax your form and sales contract to us at 312 793-3841.
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Form Information

Fact Name Details
Purpose of Form The CBS-1 form is used to notify the Illinois Department of Revenue about the sale, purchase, or transfer of business assets outside the usual course of business.
Assets Covered This form applies to the sale or transfer of major parts of stock, furniture, fixtures, machinery, equipment, or real property.
Submission Deadline Forms must be submitted within 10 days after the sale date to be processed. Late submissions will not be accepted.
Liability for Debts The purchaser or transferee may be held responsible for any debts incurred by the seller during the transaction.
Contact Information For additional assistance, individuals can contact the Chicago office at 312-814-3063, available on weekdays from 8:30 a.m. to 5:00 p.m.
Mailing Address Completed forms, along with the sales contract and financing agreement, should be mailed to the Bulk Sales Unit at the Illinois Department of Revenue, 100 West Randolph, Level 7-400, Chicago, IL 60601.
Governing Laws This form is authorized under the Illinois Income Tax Act (35 ILCS 5/902) and the Retailers’ Occupation Tax Act (35 ILCS 120/5j).

Detailed Guide for Filling Out Cbs 1 Illinois

Completing the CBS-1 form is an essential step when selling or transferring significant business assets in Illinois. Ensure that you gather all necessary information before starting the process. Follow these steps carefully to fill out the form accurately and submit it within the required timeframe.

  1. Begin with Part 1. Enter the business name in the first blank field.
  2. Provide the Illinois business tax number (IBT no.) or account identification number in the second blank field.
  3. Fill in the street address of the business.
  4. Input the federal employer identification number (FEIN) in the fourth blank field.
  5. If applicable, complete the street address for any additional location.
  6. Enter the social security number in the sixth blank field.
  7. Indicate whether you are required to pay any excise taxes by checking "Yes" or "No."
  8. Complete the city, state, and ZIP code fields.
  9. In Part 2, identify the seller or transferor. Write the name and daytime phone number in the designated fields.
  10. Provide the home or mailing address of the seller or transferor.
  11. Input the name of the seller’s or transferor’s attorney, along with their daytime phone number.
  12. Fill in the city, state, and ZIP code for the attorney's address.
  13. Move to Part 3 and identify the purchaser or transferee. Write their name and IBT no. or FEIN in the respective fields.
  14. Provide the home or mailing address for the purchaser or transferee.
  15. Input the name of the purchaser’s or transferee’s attorney and their daytime phone number.
  16. Fill in the city, state, and ZIP code for the attorney's address.
  17. In Part 4, enter the date the business was or will be sold or transferred.
  18. Input the selling price of the business or the value of the business assets transferred.
  19. Indicate whether the entire business was sold or transferred by checking "Yes" or "No." If "No," complete Line 20.
  20. State whether the seller’s or transferee’s registration numbers with the department will remain active. Provide the date to be discontinued if applicable.
  21. Describe the terms of sale or transfer. Check the appropriate box and provide additional information as requested.
  22. In Part 5, print or type your name and daytime phone number.
  23. Sign and date the form in the designated fields.
  24. Finally, provide the mailing address of the person submitting the form.

After completing the form, make sure to attach a copy of the sales contract and financing agreement. You can mail your completed Form CBS-1 to the Illinois Department of Revenue or fax it if preferred. Ensure that all documents are submitted within the required timeframe to avoid any potential issues.

Obtain Answers on Cbs 1 Illinois

  1. What is the purpose of the CBS-1 form?

    The CBS-1 form is used to notify the Illinois Department of Revenue about the sale, purchase, or transfer of business assets. This includes major parts of a business such as stock of goods, furniture, fixtures, machinery, equipment, or real property. It is important to complete this form to ensure compliance with state tax laws and to avoid any potential liabilities related to unpaid taxes.

  2. Who is required to fill out the CBS-1 form?

    The form must be completed by either the seller or the purchaser/transferee of the business assets. If the sale or transfer occurs outside the usual course of business, it is mandatory to file this form. Additionally, if the form is submitted more than 10 days after the sale date, it will not be processed.

  3. What happens if the CBS-1 form is not submitted on time?

    If the CBS-1 form is not submitted within the required timeframe, specifically within 10 days of the sale date, the Illinois Department of Revenue will not process the form. This could lead to complications for the purchaser or transferee, as they may become liable for any debts incurred by the seller.

  4. How do I submit the CBS-1 form?

    You can submit the completed CBS-1 form along with a copy of the sales contract and financing agreement by mail or fax. To mail the documents, send them to:

    • BULK SALES UNIT
    • ILLINOIS DEPARTMENT OF REVENUE
    • 100 WEST RANDOLPH LEVEL 7-400
    • CHICAGO, IL 60601

    If you prefer to fax the form and sales contract, the fax number is 312-793-3841. Ensure that all required information is accurately filled out to avoid delays in processing.

Common mistakes

When filling out the CBS-1 Illinois form, many individuals make mistakes that can lead to delays or complications in processing. One common error is failing to submit the form within the required timeframe. The Illinois Department of Revenue specifies that forms must be received within ten days of the sale date. If this deadline is missed, the submission will not be processed, which can result in the purchaser or transferee being held liable for any debts incurred by the seller.

Another frequent oversight involves incomplete or incorrect identification information. It is crucial to provide accurate details about the business being sold or transferred, including the business name, Illinois business tax number, and federal employer identification number. Omitting any of these details can lead to confusion and may delay the processing of the form.

Many individuals also neglect to include necessary supporting documents. Along with the CBS-1 form, it is essential to attach a copy of the sales contract and any financing agreements. Without these documents, the submission may be deemed incomplete, which can complicate the transfer process.

Additionally, some filers mistakenly answer questions incorrectly, particularly regarding the status of the business and the terms of sale. For example, if the entire business is sold, the form must reflect this accurately. Misrepresenting the nature of the transaction can lead to legal complications down the line.

Another mistake often made is failing to provide accurate contact information for both the seller and the purchaser. Daytime phone numbers and mailing addresses must be clear and correct. If the Department of Revenue needs to reach out for clarification or additional information, having incorrect contact details can hinder communication.

Lastly, individuals frequently overlook the importance of signatures and dates. The form must be signed by the person submitting it, and the date of submission must be included. An unsigned form, or one without a date, may be rejected, leading to further delays in the processing of the sale or transfer.

Documents used along the form

When navigating the sale or transfer of business assets in Illinois, several forms and documents complement the CBS-1 form. Understanding these additional documents can streamline the process and ensure compliance with state regulations. Here’s a brief overview of some of the key forms often used alongside the CBS-1.

  • Sales Contract: This document outlines the terms of the sale, including the price, payment schedule, and any contingencies. It serves as a binding agreement between the seller and purchaser, detailing the obligations of both parties.
  • Financing Agreement: If the sale involves financing, this document specifies the terms under which the purchaser will pay for the business assets. It typically includes interest rates, payment amounts, and the duration of the loan.
  • Form ST-1: This is the Illinois Sales Tax Registration form. If the sale involves tangible personal property, the seller may need to collect sales tax, and this form ensures compliance with tax regulations.
  • Form IL-1040: This is the Illinois Individual Income Tax Return form. If the sale generates income for the seller, they must report it on their tax return, making this form essential for personal tax obligations.
  • Form 1099: This form is used to report various types of income other than wages, salaries, and tips. If the seller receives payment that qualifies as reportable income, a 1099 may be issued.
  • Business License Transfer Application: If the business operates under a specific license, this application may be necessary to transfer the license to the new owner. It ensures that the new owner is legally authorized to operate the business.
  • UCC Financing Statement (Form UCC-1): This document is filed to secure a lender’s interest in the business assets being sold or transferred. It provides public notice of the lender’s claim to the assets until the debt is satisfied.

By familiarizing yourself with these documents, you can better navigate the complexities of business asset sales in Illinois. Each form plays a crucial role in ensuring that the transaction is legally sound and that both parties fulfill their obligations. Proper preparation can help avoid potential pitfalls and facilitate a smoother transition of ownership.

Similar forms

The CBS-1 form from the Illinois Department of Revenue is essential for reporting the sale or transfer of business assets. Similar documents serve related purposes in business transactions. Here are five documents that are similar to the CBS-1 form:

  • Form 990-T: This form is used by tax-exempt organizations to report unrelated business income. Like the CBS-1, it requires detailed information about the transaction and its implications for tax liability.
  • Form 8594: This asset acquisition statement is filed when a business is sold. It outlines the allocation of the purchase price among the assets sold, similar to how the CBS-1 details the assets being transferred.
  • Form ST-1: This sales tax exemption certificate is used in Illinois for certain transactions. Both forms require information about the seller and purchaser, ensuring compliance with tax regulations.
  • Form 1065: Partnerships use this form to report income, deductions, and other tax information. It shares similarities with the CBS-1 in that both require the identification of parties involved in a business transaction.
  • Form 1040 Schedule C: Sole proprietors use this form to report income or loss from a business. Both the Schedule C and the CBS-1 require detailed financial information about the business being reported on.

Dos and Don'ts

When filling out the CBS-1 Illinois form, attention to detail is crucial. Adhering to best practices can streamline the process and prevent potential issues. Below is a list of things to do and avoid:

  • Do complete the form within 10 days of the sale date to ensure processing.
  • Do provide accurate identification numbers for both the seller and purchaser.
  • Do include a copy of the sales contract and financing agreement with your submission.
  • Do double-check all entries for accuracy before mailing or faxing the form.
  • Do contact the Chicago office if you have any questions or need assistance.
  • Don't leave any required fields blank; incomplete forms may be rejected.
  • Don't forget to sign and date the form before submission.
  • Don't assume that the seller’s registration numbers will remain active without confirming.
  • Don't wait until the last minute to submit the form; allow time for processing.
  • Don't ignore the requirement to report all sales of businesses to the Illinois Department of Revenue.

Misconceptions

Understanding the CBS-1 form in Illinois can be tricky. Here are ten common misconceptions about this form, along with clarifications to help clear things up.

  • Only the seller needs to fill out the form. Both the seller and the purchaser or transferee must complete the CBS-1 form.
  • The form is optional. Completing the CBS-1 is required when transferring a significant part of business assets.
  • There’s no deadline for submitting the form. The form must be submitted within 10 days after the sale date; otherwise, it won't be processed.
  • Only large businesses need to file. Any business that sells or transfers major assets, regardless of size, must file the form.
  • The purchaser is not responsible for seller’s debts. The purchaser may be held liable for any debts incurred by the seller if the form is not filed.
  • Filing can be done at any time. The form must be filed promptly to avoid complications with the sale.
  • Faxing the form is not allowed. You can fax the completed CBS-1 form along with the sales contract to the Illinois Department of Revenue.
  • There are no penalties for late filing. Failing to file on time can lead to personal liability for the purchaser.
  • The form is only for real estate transactions. It applies to various business assets, including stock, furniture, and equipment.
  • Once filed, no further action is needed. Keep copies of the form and any related documents for your records, as they may be needed later.

These misconceptions can lead to confusion and potential issues during a business sale or transfer. It's always best to understand the requirements clearly to ensure a smooth process.

Key takeaways

Filling out the CBS-1 form is an important step when selling or transferring business assets in Illinois. Here are key takeaways to keep in mind:

  • Timeliness is crucial. Submit the form within 10 days of the sale date to ensure processing.
  • Liability concerns. The purchaser or transferee may be held responsible for any debts incurred by the seller.
  • Required information. Complete all sections of the form, including business identification numbers and contact details.
  • Supporting documents. Include a copy of the sales contract and financing agreement when mailing the form.
  • Contact information. For questions, reach out to the Chicago office during business hours at 312-814-3063.
  • Mailing details. Send the completed form to the Bulk Sales Unit at the Illinois Department of Revenue in Chicago.
  • Legal obligations. Reporting all business sales is required by Illinois law, and failure to do so may result in liability for taxes owed.