2021 Business Vehicle sold, TT showing gain but it's a loss

[DFMu]

Sold Business Vehicle in 2021.  Purchased in 2008 for $93,320.  Sold in 2021 for $46,000.  36.3% of vehicle use attributed to business, so business portion of purchase price plus improvements (solar) is $33,859 and business portion of sales prices is $16,690 for net loss of $17,169 less $2,486 mileage equivalent to depreciation for a net loss of $14,684.  Turbotax is showing entire business portion of sale of $16,690 as a gain.  I entered basis for as $90, 834 (total cost less mileage equivalent to depreciation).  Is something wrong with Turbotax or my calculations?  Thank you.

[RobertB4444]

TurboTax is almost certainly assuming that the vehicle was fully depreciated years ago.  That would be my assumption as well, especially if you entered the vehicle into TurboTax in 2008  So if you do the math assuming that the vehicle is worth zero dollars because it was fully depreciated then TurboTax's math makes more sense.

[DFMu]

I never used depreciation method.  I only received business deduction of $2,486 for mileage only.  

[JulieS]

When you use the standard mileage method, you have to figure out the depreciation equivalent based on those miles. 

Here is a chart showing the amounts:

Say you drove 1000 miles in 2020 and 1000 miles in 2019.

1000 miles X .27 = $270

1000 miles X .26 = $260

270 + 260 = $530 depreciation

Unless you use a different figure, TurboTax will assume you depreciated the vehicle to the full extent allowed. 

[DFMu]

Thank you.  yes, i did that.  Total depreciation equivalent since 2008 is $2,486 as stated in original post.

[KrisD15]

I would add that you may have entered the (solar?) improvement as a separate asset, in which case you would need to report that as sold as well and allocate a portion of the selling price (46,000) to that asset also. 

Additionally, you may need to check if "Bonus" depreciation or Section 179 deduction was ever use for either asset. 

[DFMu]

Thanks.  I didn't enter solar as separate asset and I have only used mileage deduction because I didn't want to get in the situation I'm in now which is owing a lot of taxes that I hadn't planned for.

[AmeliesUncle · Accepted solution]

TurboTax is not set up to report the sale of an asset (such as a vehicle) that has varied in business percentage from year to year.

In the vehicle section (or asset section, for other assets), you can say it was converted to personal use.  Then in the "Sale of Business Property" section, you can enter the MANUALLY calculated amounts.

[DFMu]

Thank you so much, I thought I was going to have to take my taxes to a tax preparer to get it right.  Very strange that TT tells you to calculate equivalent depreciation but doesn't use it.  So glad you responded.

[agater11]

now i am SO confused. In order to bypass this, i jump to "sale of business property" and then select recapture?

[RobertB4444]

@agater11  No, click on 'Sales of Business Property You Haven't Already Reported.'  Then on the third screen you'll enter all of the information about the sale.