I bought a 2012 Toyota Prius in 2012 for personal use. I started to use it for business on 1/1/2016 and then donated it to a non profit organization on 12/27/2016. The market value of the car at the time of donation is about 12K according to KBB. I bought it for 24K. Turbo Tax shows a loss of 12K on form 4797. Is that correct? Can I also deduct it in the "Donations to charity in 2016" section of the deductions & credit? Thank you for your help. Thank you.
Yes, you can take a deduction for the donation of your vehicle, but you can't count it twice.
When you report the sale on Form 4797, then you will owe tax on the recaptured depreciation, even if you claimed the standard mileage allowance (which includes a depreciation factor). The recaptured depreciation is calculated using the number of miles you claimed for business for each year times the amount from the table in the screenshot, below.
You can either report the sale price as equal to the amount you are claiming for the deduction ($12,000 in your case), then claim the deduction on Schedule A, or you can state the sale price of $0 and not report the deduction, whichever gives you the lowest tax.