Seems darn near everybody thinks that depreciation is a permanent deduction. Then they are surprised years later when they sell the depreciated asset, that it's not a permanent deduction.
If you took 100% depreciation the first year, then your cost basis on the asset is zero in the tax year you sell it or trade it in. If sold, any money received for the asset is reportable/taxable income. If traded in, any trade in amount you were compensated for the new vehicle is reportable. It's kinda like your cost basis of the new vehicle is reduced by the trade-in value.
