9/20 bought car for 30287 inc tax and fee.12/21 sold car for 32000.After paying finance company received check for 7209 and used it as down for another car.How to report?

[ColeenD3]

Is this a business vehicle or a personal vehicle? The amount you received from the finance company is irrelevant. If this is a personal vehicle, based on this information,  you will have a gain of $1,713.

If this is a business vehicle, it is more complicated. You will have to include this on Schedule C if you are a sole-proprietor.

[Kriti-acharya43]

Its a personal vehicle. The reason why I asked the question is because I read somewhere that if someone use the proceed from the sale of their house and close another house within 180 days then they dont have to pay capital gain taxes.. doesnt similar rule apply for the sale of vehicle as well because i used the proceed to buy another vehicle? 

[DoninGA]

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@Kriti-acharya43 wrote:

Its a personal vehicle. The reason why I asked the question is because I read somewhere that if someone use the proceed from the sale of their house and close another house within 180 days then they dont have to pay capital gain taxes.. doesnt similar rule apply for the sale of vehicle as well because i used the proceed to buy another vehicle? 

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You are referring to a Section 1031 Like-Kind Exchange.

Under the Tax Cuts and Jobs Act, Section 1031 now applies only to exchanges of real property and not to exchanges of personal or intangible property.

Your vehicle sale was a personal property sale so it has to be reported on your tax return since you had a gain on the sale of the personal property.

[ColeenD3 · Accepted solution]

No, there is no such provision for vehicles. Since you sold the car at a gain, you will have to pay the tax. However, since it is personal use, you would not have been able to deduct a loss, had there been one.

To enter an investment sale other than from a brokerage account (1099-B), follow the steps below.

• Click on Federal Taxes (Personal using Home and Business)
• Click on Wages and Income (Personal Income using Home and Business)
• Click on I'll choose what I work on (if shown)
• Under Investment Income
• On Stocks, Mutual Funds, Bonds, Other, click the start or update button

[Kriti-acharya43]

Thank you for the response. Could you please point me to the section where I have to report the capital gain taxes in Turbo Tax 😀