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camiandjae
New Member

I recved a final settlement of my volkswagen amount of 5k is this taxable and where should i report this in the 1040?

 
1 Reply
IsabellaG
Expert Alumni

I recved a final settlement of my volkswagen amount of 5k is this taxable and where should i report this in the 1040?

No, if this was a situation where your car was totalled and you received an insurance settlement, there wouldn't be a taxable event unless this was a business vehicle. 

You would subtract your cost basis (what you paid for the car) from the $5K you received to determine a gain or loss. If you paid more for the car than what you received as a settlement, you'd have a loss, but it's not deductible (or reportable) because it's a personal loss.

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