How do I deduct my business vehicle that I bought from it's lease in 2019? The date I became the owner is after the date I started using it for business.

[KatDesign]

My vehicle was new when I leased it in 2016, and I started using it for business that December, then bought out the vehicle in 2019. My research from other answers to questions shows a couple of things (please correct if either is wrong):

1. It would be considered purchased used.

2. I would have to mark that I stopped using this vehicle for business in 2019, and add another separate instance of the vehicle that starts from date of purchase. To complicate the situation, I purchased it in the middle of the year, so the expenses are split between the leased time and the owned time.

Also, if I do need to add it as a new separate instance of the vehicle, can I take the standard deduction despite having taken the actual expense for the first year it was leased?

[Critter · Accepted solution]

1. It would be considered purchased used.  yes ... it is used

2. I would have to mark that I stopped using this vehicle for business in 2019, and add another separate instance of the vehicle that starts from date of purchase. To complicate the situation, I purchased it in the middle of the year, so the expenses are split between the leased time and the owned time.  yes ... you have 2 cars to report ... one was leased and one you bought even though it was the same car

[KatDesign]

So in Turbo Tax, when I edit information for the "old" (leased) vehicle, should I check, "I stopped using this vehicle in 2019."? And when it asks on the next screen whether I own, lease, or it isn't mine, would I select lease for this one, and own for the other instance of the vehicle? Or would I selected own for both instances? I am pretty sure that selecting lease for the first instance and own for the 2nd is the correct course to take, but I'd like to be certain.

[ThomasM125]

You would say you leased the vehicle that you stopped using and own the one that you purchased in 2019.