SabrinaD2
Expert Alumni

Deductions & credits

When you trade in a car, the trade-in value isn't taxable income. It's used towards the new vehicle.

In your case:

  • Trade-in value: $15,000
  • Down payment: $6,300
  • The remaining $8,700 is just the difference and not considered income.

If you have any more questions, feel free to ask!