I have a trucking company and purchased a used truck in 2018 and took the full section 179 deduction of 25,000 when I filed my taxes. This year the frame broke on the truck and I sold it at auction for 6,000. When I enter the info into TurboTax I'm showing a gain of 31K, 6K for the sale and 25K for the recapture.
I understand the recapture as I sold it early, however if last year's deduction is being recaptured then this year I should show a 19K loss on the sale having taken no other depreciation.
How do I get TurboTax to report this correctly?
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The Truck is an asset of the business go through the business screens to Business Expenses.
Click on Cars, Trucks and other vehicle expenses.
Under the Titled Vehicle Summary you should see the truck listed. Click Edit. Then on the screen titled Tell us about your business vehicle at the bottom of the page there is a box to check I stopped using the vehicle in 2019.
Then a box opens asking for the date your stopped using the vehicle.
Then is asks about usage of the vehicle for 2019. Once you enter that information then you will get to a screen Do Any of these apply to the Vehicle? The next screen asks for the sale price of the truck and selling expenses.
Continue through the screens to add information about basis and depreciation and then the program figures the depreciation recapture and any possible gain or loss on the sale of the Truck.
I've gotten where I am by answering the questions. I think my problem lies in the tax basis. I thought the software would pick it up automatically as I've given it the purchase price and prior depreciation. When it asks me the tax basis it appears that it does not apply to me so I've left it blank. The first part does not apply to me as I paid cash, so following instructions below I left the fields blank. Should I have entered 25,000?
That didn't work either. It still lists the sale as a gain.
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