your adjusted basis is $20,000 , $10,000 personal, $10,000 business there is no depreciation on the personal portion. if sold the sales proceeds would be allocated 50/50. (assuming the 50% business use holds until sold) so if you sold for $20,000, you would have 0 personal gain (personal losses are not deductible) and if your vehicle is fully depreciated you would have $10,000 of depreciation recapture. fully depreciated and sell for $10,000 you would have a non deductible personal loss of $5,000 and $5,000 of depreciation recapture. i don't know if the proceeds you'll receive on the lemon law settlement will be reported to the iRS.
