If you used this car in your business, you would also have to take into account depreciation.
The sale of your business vehicle is reported on Form 4797 Sales of Business Property which would then flow to Schedule D Capital Gains and Losses.
Go through your Schedule C Business.
- You should have set up the vehicle as an asset when you set up your business.
- If you didn't, you'll have to do that before you can "sell" the vehicle in TurboTax.
To get to that section of TurboTax:
- Open or continue your return
- Search for schedule c and select the Jump to link in the search results
- Edit the vehicle.
- When you get to the Tell Us More About This Asset/Large Purchase screen, select The item was sold, retired, stolen, destroyed, disposed of, converted to personal use, traded in, or given away (or it's no longer being used in this business for some other reason).
- Continue with the onscreen interview until complete.
If this car was your personal car and not used in business, in most situations, the basis of an asset is its cost to you. The cost is the amount you pay for it in cash, debt obligations, and other property or services. Cost includes sales tax and other expenses connected with the purchase. See IRS Topic No. 703, Basis of Asset.
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