I'll answer your questions by your numbers -
- Yes, your calculations here are correct.
- Total cost is asking for the purchase price or FMV when you started using it for business. This is not the calculation for adjusted basis, so for biz X and Y, you will need to determine the FMV of the car at the time you started using it for each. So, for biz X the calculation is $26,983 x biz X usage percentage in 2017 (as long as you started using the car for the business on day 1 or 2 of owning it). Biz Y's total cost will be FMV on 5/23 x biz Y usage percentage for 2022 and Biz Z's total costs will be FMV on 6/23 x biz Z usage percentage for 2022.
- If you did not trade in a vehicle you used for business before when you bought the Honda, your basis is the purchase price. If you did trade in a vehicle that you used for business before, you need to use the adjusted basis of the trade-in as your gain/loss basis. To calculate your gain/loss basis on a trade-in transaction take the original purchase price of the traded-in vehicle x biz usage percentage, add any improvements (like a new engine) at the biz usage percentage, and subtract the allowable depreciation taken on your previous tax returns.
- Yes, your calculations are correct.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
