You have to enter the truck as an asset first.Then, you can take a "Section 179" deduction which allows you to depreciate the entire truck (if you have at least $4,500 of taxable income from the business). It turns out the same as an expense, a deduction for the entire $4,500. The Section 179 deduction is limited to the taxable income of your business, the remaining deduction carries forward to the next year.
Here are the list of steps to take in TurboTax Online Self Employment to get to the Section 179 deduction, with your tax return open, click on Federal Taxes in the black bar on the left
- Under Wages & Income tab at the top, click Review next to self employment income and expenses
- On the screen Your 2017 self employment work summary, click Edit next to your business (if you have it set up)
- Click on Add Expenses for this work
- On the screen Tell us about any expenses for business click on Vehicle and Continue at the bottom of page
- Did you use a car or truck for your business? Yes
- On the screen Tell us about your business vehicle, enter your vehicle information
- On the next screen, choose Yes I own this vehicle if not you cannot take the Section 179 deduction
- On the next screen answer questions for Was this vehicle available for personal use in 2017?
- On the next screen answer questions for Let's get some info about how you tracked your business and personal miles in 2017
- On the next screen answer questions about How do you want to enter your mileage for your Truck? and enter your mileage, if you have less that 50% business use, you cannot take the Section 179 deduction
- On the next screen answer questions How many vehicles did you use for your business?
- TurboTax may say you've got a standard mileage deduction. Click on Yes, I'd like to see if my actual expenses give me a bigger deduction.
- On Let's get your actual expenses for your vehicle, enter all your actual expenses for the year
- On the next screen answer questions Ok. Let's get some info about who used this vehicle
- On the next screen answer question Was your vehicle used for hire?
- On the next screen answer question Did you purchase your vehicle new?
- On the next screen answer question Did you trade in another vehicle to purchase your vehicle? If yes enter questionTotal cash and/or loan amount paid with the trade-in.
On the next screen answer question When did you acquire your vehicle?
- On the next screen answer question Let's figure out the value of your vehicle and enter the cost.
- The next is where you enter the amount you want to take for Section 179 (or choose the special depreciation allowance if the vehicle was new when you purchased it). Click on Our Recommendations to read more. Your total section 179 deduction for 2017 is limited to $510,000, so if you place several assets in service in a certain year, it may be better to take the regular depreciation deduction for certain items.You can only take the section 179 deduction to the extent of your net income for the year. If you try to take the deduction for a year in which you have a net loss, you will simply carry the deduction forward indefinitely until you show a profit. Reminder: In future years, if your business use percentage drops to 50% or below you no longer use the asset in your business, you may have to report the section 179 deduction as income. This is known as recapture.
Report the 2010 dump truck as an Vehicle under the self-employment activity.
Go to Federal / Income & Expenses / Your income and expenses / Self-employment income and expenses.
Click Edit / Add / Start to the right.
Click Edit / Add / Start to the right of Vehicle.
Click Add another vehicle.
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