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sajmani
Level 2

Got CA state rebate to buy electric car and got 1099G for rebate amount. State required that I give my old car to a Dismantler. How to deduct value of my car dismantled?

 
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ThomasM125
Employee Tax Expert

Got CA state rebate to buy electric car and got 1099G for rebate amount. State required that I give my old car to a Dismantler. How to deduct value of my car dismantled?

Box 6 on form 1099-G is Taxable Grants. By grant, that means you received something of value that you don't have to pay back, sort of like a gift. Grant income is reported as Other Income on your tax return. 

 

If the income was associated with a business or investment, related expenses would be deductible. But since the income is associated with personal property, the value of your auto is not deductible in my opinion, since losses on personal items are not deductible, accept in the case of casualty or theft.

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5 Replies
ThomasM125
Employee Tax Expert

Got CA state rebate to buy electric car and got 1099G for rebate amount. State required that I give my old car to a Dismantler. How to deduct value of my car dismantled?

You can't deduct the value of a personal auto that was dismantled. You could only deduct it if you used it in a business.

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sajmani
Level 2

Got CA state rebate to buy electric car and got 1099G for rebate amount. State required that I give my old car to a Dismantler. How to deduct value of my car dismantled?

Thanks! My state’s rebate counted as my income. Income should get reduced by value of my car because dismantling it was a requirement by state to get the rebate. Otherwise I could have sold my car at fmv.

ThomasM125
Employee Tax Expert

Got CA state rebate to buy electric car and got 1099G for rebate amount. State required that I give my old car to a Dismantler. How to deduct value of my car dismantled?

The problem is you received a grant, you didn't sell the auto, but I see what you are saying. What box was the income reported on the form 1099-G?

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sajmani
Level 2

Got CA state rebate to buy electric car and got 1099G for rebate amount. State required that I give my old car to a Dismantler. How to deduct value of my car dismantled?

Box 6 of form 1099G. Also, on one hand state gave rebate to buy EV then even CA state wants income tax on it besides IRS!

Thanks!

ThomasM125
Employee Tax Expert

Got CA state rebate to buy electric car and got 1099G for rebate amount. State required that I give my old car to a Dismantler. How to deduct value of my car dismantled?

Box 6 on form 1099-G is Taxable Grants. By grant, that means you received something of value that you don't have to pay back, sort of like a gift. Grant income is reported as Other Income on your tax return. 

 

If the income was associated with a business or investment, related expenses would be deductible. But since the income is associated with personal property, the value of your auto is not deductible in my opinion, since losses on personal items are not deductible, accept in the case of casualty or theft.

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

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