Investors & landlords

It can seem challenging and it's up to you if you prefer not not use it in 2025, however you do need to properly dispose of the vehicle. I will provide the steps that will make it easier and less challenging. As indicated, due to the varied business use, not only in one year but over many years the best action is shown here. 

First find the information shown below and while you are in the vehicle section do the following:

1. When go to the vehicle information under your rental you can select 'Sold, disposed of, etc....' then do not indicate it was sold.  You must say 'Yes' it was converted to personal use.  This will eliminate any sales information in the vehicle itself.
2. Total all of the business miles for the life of the vehicle
3. Total all miles on the vehicle for the life of the vehicle
4. Business miles divided by total miles = Business Use Percentage for the life of the vehicle
5. Take the original cost of the vehicle x the business use percentage = Business Cost
6. Take the sales or trade-in price x the business use percentage = Business Sales Price
7. Calculate all of the business miles by year with the rate in the Standard Mileage Rate (SMR) for depreciation (chart attached) to arrive at the total depreciation considered used by the IRS.

Next enter your Sale of Business Property (do not enter any sales information in the vehicle asset)

1. Income at the top
2. Scroll down to Other Business Situations
3. Select Sale of Business Property
4. Select Sales of business or rental property that you haven't already reported.
5. Answer 'Yes' to Do all of the following apply...?
6. Enter your sales information make an entry for depreciation
   1.  Description of the Property (Vehicle made/model/year)
   2. Sales Price/Sales Expenses 
   3. Date acquired and date sold
   4. Cost
   5. Depreciation

Annual Depreciation Component Breakdown (for more years see the chart in IRS Pub 463)

• 2025: $.33
• 2024: $.30
• 2023: $.28
• 2022: $.26
• 2021: $.26

@Aussie 

[Edited: 02/26/2026 | 4:11 PM PST]