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Level 3
posted Feb 16, 2025 7:53:29 AM

gifted personal car used partially for business

I gave away my 2007 Honda Civic that was a personal car used at times for business errands.  Now Turbotax is wanting me to do depreciation on my tax return.  I don't understand why, what to do to fix this.  I would appreciate any assistance on this.   Thanks!  

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3 Best answers
Expert Alumni
Feb 18, 2025 7:15:49 AM

Your car was given away for zero dollars so TurboTax needs to know the car is no longer a business asset.  You can do the following.

  1. In the vehicle on your tax return you can check the box that it was converted to personal use. This will remove it for future years.
  2. If you had received any money for it, then you could also report a business sale, but since you didn't receive any money there is nothing else to do.

Open your TurboTax Desktop return

  1. Select Business Income and Expense
  2. Edit beside your business
  3. Select Business Vehicle > Edit
  4. Enter the date you gave it away
  5. Continue to finish your vehicle screens
  6. See the image below.

                

Expert Alumni
Feb 27, 2025 6:56:13 AM

The MACRS convention is usually HY (half-year). See if the drop-down provides that option.

 

@midpitts 

Level 3
Feb 27, 2025 7:07:48 AM

Yes,  it is there.  I will give it a try. Thanks!

7 Replies
Expert Alumni
Feb 17, 2025 7:35:38 AM

You need to set up your Honda as a sale or disposition as of the date that you gave it away and for $0.  Then TurboTax will only depreciate the percentage of business use for the part of the year that it was still used for business.

 

@midpitts 

Level 3
Feb 17, 2025 5:12:39 PM

Robert,  Thanks for trying to help me.  My car was my personal car that I just used for business some of the time.   It was never a "company car".   I have never depreciated it in the past and I just take the standard mileage deduction for the business miles I travel.   I am a sole proprietor, I don't know if this makes a difference. 

Expert Alumni
Feb 18, 2025 7:15:49 AM

Your car was given away for zero dollars so TurboTax needs to know the car is no longer a business asset.  You can do the following.

  1. In the vehicle on your tax return you can check the box that it was converted to personal use. This will remove it for future years.
  2. If you had received any money for it, then you could also report a business sale, but since you didn't receive any money there is nothing else to do.

Open your TurboTax Desktop return

  1. Select Business Income and Expense
  2. Edit beside your business
  3. Select Business Vehicle > Edit
  4. Enter the date you gave it away
  5. Continue to finish your vehicle screens
  6. See the image below.

                

Level 3
Feb 19, 2025 4:24:33 AM

Thank you so much!  I am still getting a depreciation prompt, but I am just going to ignore it and see if it lets me file anyways.

Level 3
Feb 27, 2025 5:54:56 AM

Darn,  it won't let me file.  I keep getting this prompt.  Can you tell me what to do??  

Expert Alumni
Feb 27, 2025 6:56:13 AM

The MACRS convention is usually HY (half-year). See if the drop-down provides that option.

 

@midpitts 

Level 3
Feb 27, 2025 7:07:48 AM

Yes,  it is there.  I will give it a try. Thanks!