topic 2019 Business Disposal of Assets in Business & farm

2019 Business Disposal of Assets

Hanko1 — Mon, 03 Feb 2020 22:11:03 GMT

I sold a business in 2019, but when I list the various assets in the software, the program does not total correctly. For example, if I have an asset that has a FMV of $100,000 and sold for $100,000 but had $50,000 in past depreciation, the program should total a $50,000 gain (sale price (FMV) minus depreciation = gain). It totals zero for every asset (irregardless of class). Has anyone seen this?

Re: 2019 Business Disposal of Assets

DavidD66 — Tue, 04 Feb 2020 00:14:40 GMT

In order to dispose of assets properly in TurboTax, they have to be set up in TurboTax correctly. Before you dispose of an asset, you will have to enter the asset, its cost, the date it was placed in service, etc. The program will calculate prior year depreciation which it will use to calculate gain or loss on disposal.

Re: 2019 Business Disposal of Assets

Hanko1 — Tue, 04 Feb 2020 18:36:35 GMT

Thanks for the answer. All of the assets have been imported from the 2018 return, so they are set-up. I am seeing that the 2019 program does not total the gain properly. It records a zero for all assets. If sale price was $100,000 FMV and remaining basis is $50,000, I should get a gain of $50,000. Instead it just reads zero.

Re: 2019 Business Disposal of Assets

DavidD66 — Wed, 05 Feb 2020 02:09:01 GMT

It's very difficult to troubleshoot issues like this without being able to see what's happening. You may want to utilize TurboTax Live, that will let you talk to a CPA or EA who can also see your tax return. For more information see What is TurboTax Live?

Re: 2019 Business Disposal of Assets

Carl — Wed, 05 Feb 2020 03:50:12 GMT

For folks in your situation there are a few "quirks" in TurboTax that flat out can not be accounted for with any amount of programming. So here's what to check.

If you sold the business at a gain (and you did) then you "MUST" show a taxable gain and each and every asset. Even if that gain on some assets is only $1 after deducting prior depreciation taken from the cost basis of that asset. (recaptured depreciation reduces the cost basis of the asset - not the sales price of the asset.)

If all of your assets but one shows a taxable gain, and that one shows a loss, the program just flat out can not deal with it correctly in some cases. You very well might be experiencing one of those "some" cases.