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TERA1
Level 2

Buisness Basis of Vehicle

I disposed of a vehicle that in the  past (not for the past 6 years) I claimed some business use of based on expenses (not mileage). In the car and truck worksheet I get the dreaded error Depreciation allowed is too large message. As far as I can tell the depreciation that automatically comes up is accurate but it seems that turbotax is using 0 for the business basis of the vehicle and so all prior depreciation (going back 24 years!) is being treated as a gain on the sale! I tried entering my estimate of the business basis (based on an old turbotax calculation) on line 49 (gain/loss basis if different from line 33c) but this had no effect.

 

Is there anywhere to fix this either by entering a business basis or otherwise. I'm happy the give Uncle Sam a portion of the meager trade in value of this vehicle (% of business use) but this is a tiny fraction of what Turbotax is suggesting.

 

Thanks.

1 Best answer

Accepted Solutions
ThomasM125
Expert Alumni

Buisness Basis of Vehicle

When you report the sale of a business asset in TurboTax, you should see a screen like this that allows you to enter cost and depreciation taken on the asset:

 

You should see a screen that says "Any Other Property Sales?"

 

You get to that screen by indicating that you are selling business property:

 

 

 

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6 Replies
AmeliesUncle
Level 13

Buisness Basis of Vehicle

TurboTax is not capable of calculating the sale when the business percentage has varied from year to year.  So that means you need to either manually calculate the numbers and report it in the "Sale of Business Property" section, or you would need to go to a tax professional.

TERA1
Level 2

Buisness Basis of Vehicle

Much of the issue is being unable to manually enter values. The error that depreciation exceeds business basis gives no indication of how this was calculated, where the business basis is shown, or where one can enter a correct value.

ThomasM125
Expert Alumni

Buisness Basis of Vehicle

When you report the sale of a business asset in TurboTax, you should see a screen like this that allows you to enter cost and depreciation taken on the asset:

 

You should see a screen that says "Any Other Property Sales?"

 

You get to that screen by indicating that you are selling business property:

 

 

 

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
TERA1
Level 2

Buisness Basis of Vehicle

Well I don't have that exact screen (perhaps that is the online version?) but to dispose of the vehicle the info requested flows into the Car & Truck worksheet which has tracked cost, depreciation, etc since initial use so most of the fields are prepopulated. My problem is that somewhere Turbotax has calculated the business portion of the basis but does not show this and appears to have substituted 0 thus triggering the error that past depreciation has exceeded it and is thus not allowed which reverses 20 years of past depreciation into a gain!

 

I can override the cost basis on Form 4797but this does not correct the error on the worksheet and creates an override error so I can't field electronically. I thik I still need to find where and how the business basis was computed and fix that if possible.

AmeliesUncle
Level 13

Buisness Basis of Vehicle

As I said before, you need to manually report it in the "Sale of Business Property" section.  NOT the vehicle section.

TERA1
Level 2

Buisness Basis of Vehicle

So delete the record of the asset that has been on all prior returns and make an new entry just of the sale checking that it hasn't been already reported? That appears to get the job done but seems like an odd way to have to report it. Thanks

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