Sign Up

Why sign in to the Community?

  • Submit a question
  • Check your notifications
or and start working on your taxes
cancel
Showing results for 
Search instead for 
Did you mean: 
lyle2
New Member

Business assets damaged beyond repair from normal use.

I am self-employed in the lawncare field and last year 2019 I had 2 mowers get damaged from normal use and can not be repaired.  Transmission in rider is destroyed and is not cost effective to repair it, and engine in one of my commercial walkbehind mowers bent a crank and damaged the Blade Brake Clutch mechanism beyond repair, it is not usable and not cost effective to repair it as well.  How do I dispose of these assets on Turbo Tax to show they are no longer usable and are there any tax implications for these assets being unusable now for 2019?

4 Replies
ColeenD3
Expert Alumni

Business assets damaged beyond repair from normal use.

On the screen, "Tell US about this asset", click that item was sold, retired...

 

On the special handling screen, click yes as it was converted to personal use. There are no tax implications unless you took Section 179 for the asset at purchase. You may have to recapture depreciation if you did not use it for its entire useful life.

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
AmeliesUncle
Level 11

Business assets damaged beyond repair from normal use.

Unless you actually using the broken equipment for your personal use, don't say it was converted to personal use.   You would enter it as a "sale" for $0.

seasaltcpa
New Member

Business assets damaged beyond repair from normal use.

The asset in question in our situation is non-functioning but involved in a lawsuit. Court date is April 2022! We are required to recapture the Sec 179 that was taken in 2017 but we still have ownership of the asset - thought that we could just say that the asset is "not in service". Is there a way to make that distinction?

Thank you.

Connie

Critter-3
Level 15

Business assets damaged beyond repair from normal use.

Since you took the 179 deduction and the asset's basis is already zero then you can simply leave the asset on the books until you actually dispose of it after the lawsuit.  Which you will "sell off" for a Zero sales price and there will be no recapture needed.  

Dynamic AdsDynamic Ads
Privacy Settings
v