The car I originally used for my business was repossessed in April 2022. I purchased a different vehicle in May 2022. I began using the new vehicle for business purposes in May 2022. I didn't tell my tax preparer about the repossession because I was embarrassed, so they depreciated the vehicle for the entire year.
A) I would like to fix this without amending. How can I do this in Turbotax? (If it must be amended then I will amend it).
B) Going forward, if I experience a mid-year repo again, how would I enter it into Turbotax?
1) How would I enter the repo to remove it from the business and enter the replacement vehicle to add it to the business.
2) If I previously took section179 for the repossessed vehicle, how would I recapture it and apply it to the replacement vehicle.
Thank you
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You would have to edit the vehicle asset entry and indicate that you stopped using the vehicle for business:
Later, you would indicate that you started using the vehicle for personal purposes during the year:
This will stop depreciation on the old vehicle and remove it from your business. You would enter the new vehicle like you did the original one, that entry would not be affected by the removal of the original vehicle.
If you had taken a section 179 deduction on the vehicle, you would go to the Less Common Business Situations section and choose Sale of Business Property. Then check the recapture option box to enter your recapture information.
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