topic Section 179 in Deductions & credits

Section 179

wsirhc1 — Fri, 27 Mar 2020 20:02:50 GMT

If I purchased a vehicle for my business in 2018, and elected to take 100% depreciation. Then the following year I trade in the vehicle for another for business use, will I potentially have a recapture situation? So let’s say I paid $25k, and the following year, I purchase a $50k vehicle and trade mine in for $20k, and finance the remaining $30k. What would happen?

Re: Section 179

RobertG — Sat, 28 Mar 2020 22:31:26 GMT

Under the new tax law you can't defer the gain on the disposition of a vehicle into another vehicle.

See the IRS website: Like kind exchanges are now limited to real property.

You have to report your transaction as a sale of your old vehicle and then add the vehicle you received as a new asset.