I have a legal document describing the purchase of shares, but how do I notify the IRS or State?

Question

I have a very long document that explains a great deal of details that the purchaser and founder had regarding the share of sales. It explains the rights of shareholders, distributions, and many more things. It's rather complete.
This is just a contract essentially, documenting the sale of shares in an S-Corp to a buyer turned shareholder of the S-corp.
When the the corporation was originally registered with the authorities I was listed as the sole shareholder.
Now that this is no longer true, how and when do I update who the shareholders are to the IRS and New York State taxation entities?

Orange Coast- reinstate Monica · Answer

While most small business transactions are asset sales, you may indeed have a share sale transaction.
I think it's useful to distinguish between what the department of corporations cares about and what the tax authorities care about. The tax authorities care about your basis and your proceeds from the sale.
Here are some resources on tax issues for the sale of a business:
Loophole Lewy, IRS and SBA

I have a legal document describing the purchase of shares, but how do I notify the IRS or State?

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