Determine Gain / Loss for Car we sold in '24 used for Business + personal

[seanrosebrugh]

Trying to determine Gain / Loss of car we sold in 2024 that was bought in 2023, and used for 3 purposes:

        Uses / Purpose                                     ’23-‘24 Miles

1. Personal use                                          4,591
2. Rental Property Management           1,517
3. Self Employment                                 1,005

Car costs:                                                                          

1. Sticker / paid  (2023)               $51,025
2. Sales Taxes/Fees paid               $4,855
3. Trade in value applied             $12,500
4. Sale price (2024)                       $27,600

Depreciation :                                                                  

1. Taken in 2023                      $5,730
2. Calc’d per mileage               $723

How do I establish a Gain / Loss out of this?

[AmyC]

Let's go through the steps:

The program should be holding the car in the rental section and the self-employment section. You should be able to enter the sale in each section for the program to calculate the loss on each part. Personal portion - sold at a loss and not deductible.

Let's go in the order of the program:

Calculate business percentage

• Self employment % 1005 / total miles x100
• Rental % is 1517 / total miles x 100

Depreciation numbers. You don't do anything except verify the depreciation actually taken for each section. Only you and the program know which areas had what entries to calculate the depreciation. Mark it down so you can use the number.

Calculate the sales price % for rental and self-employment. 

• Determine the "sales price" = trade in amount plus sale price
• Use your percentage from above times the sales price to determine the sales price for each activity

Calculate basis for gain or loss

• Basis is cost plus sales tax and fees.
• Use your percentage from above and multiply it times the cost.
• Then subtract out the depreciation for that activity

Do this once in the rental area with the rental percentages and depreciation.

Do this in the self employed area with that percentage and set of numbers.

You can look at your forms and see the disposition of the vehicle. Here is an example I entered:

[AmeliesUncle]

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@seanrosebrugh wrote:

Depreciation :                                                                  

1. Taken in 2023                      $5,730
2. Calc’d per mileage               $723

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I have some questions.

First, if you took Actual Expenses (claiming depreciation) in 2023, you can not use the Standard Mileage Rate.  You must continue to use the Actual Expenses.

Second, you bought the vehicle for $55,880 and sold it for only $27,600?  After only a year or two, with only 7113 miles on it?  Was it damaged or something that caused such a drastic loss for such a low-mile vehicle?  If insurance paid you for an accident, that may affect your Basis (and therefore your gain or loss).