Deductions & credits

Your loss is not deductible.

 

Assuming the payment was less than the adjusted cost basis of the car**, it is not taxable income.

 

(For a personal vehicle never used in business, your adjusted cost basis is what you paid for the car.  If you used the car in business (such as ride sharing), you must reduce your cost basis by the amount of depreciation you claimed.  We can give you more information if you provide details.)