Deductions & credits
Let's go through the steps:
The program should be holding the car in the rental section and the self-employment section. You should be able to enter the sale in each section for the program to calculate the loss on each part. Personal portion - sold at a loss and not deductible.
Let's go in the order of the program:
Calculate business percentage
- Self employment % 1005 / total miles x100
- Rental % is 1517 / total miles x 100
Depreciation numbers. You don't do anything except verify the depreciation actually taken for each section. Only you and the program know which areas had what entries to calculate the depreciation. Mark it down so you can use the number.
Calculate the sales price % for rental and self-employment.
- Determine the "sales price" = trade in amount plus sale price
- Use your percentage from above times the sales price to determine the sales price for each activity
Calculate basis for gain or loss
- Basis is cost plus sales tax and fees.
- Use your percentage from above and multiply it times the cost.
- Then subtract out the depreciation for that activity
Do this once in the rental area with the rental percentages and depreciation.
Do this in the self employed area with that percentage and set of numbers.
You can look at your forms and see the disposition of the vehicle. Here is an example I entered:
