Hello,
I Purchased my business vehicle back in 2014 Price $33,302 sold it in 2019 for $21,000. Accumulated Depr came to $32,342. I am showing a gain of $20,040. I used the MACRS 5 yrs. I did not use Section 179 at all. My question is; on my 1120S Form 4797 where would I show sale and recapture of my business vehicle. There are 4 parts to choose to from and I am not sure if it goes on Part I, Part II, Part III or Part IV.
I am S Corp so I am filing a 1120S return. Now since I am showing a sale of asset, from my understanding the gain should go directly onto my K-1 and not appear on the 1120S on line 4 Net gain is that correct?
On Form 4797, If I select Part I the gain of $20,040 appears on K-1 Line 9 Net Gain Section 1231, if I select Part II Ordinary Gain/Losses, the amount of $20,040 appears on Line 4 on my 1120S which adds to my profit but does not appear on K-1. If select Part III 1245 the gain still shows up on my 1120S on line 4. If I select Part III 1250, 1252, 1254 or 1255 the gain $20,040 appears on K-1 on Line 9 and removed from Line 4 on 1120S.
Not sure which Part of the Form 4797 I select. And lastly if I do have to go with Part III which section do I go with 1245, 1250, 1252, 1254 or 1255?
Lastly when my gain was calculated can I say that my Depreciation was recaptured at that point? It does appear on Depreciation allowed or allowable? Cost $33,302, Accum Depr $32,342, Sold for $21,000
$32,342+21,000 = $53,342 - $33,302 = $20,040.00
Thank you in advance for assistance.
