I bought a backhoe in 2017 for $23,500 and i had to sell it and only got $15,500. how do i report the $8000 loss?

[busterrudd1]

i purchased the backhoe in May or June of 2017 and sold it in Aug of 2018. i did the depreciation thing for my 2017 taxes but now just need to show i lost $8000 and how to put that into my taxes and get the backhoe off of my records/taxes.

[DanielV01 · Accepted solution]

You will report the sale on Form 4797.  However, you might not reflect a loss.  Depreciation is factored in to determine the amount of basis you had, and determine how much loss (or even a gain) you had.

For instance, you bought the backhoe for 23500, but you have to subtract the depreciation you did (or could have) claimed.  For arguments sake, let's say you have claimed 5,000 in depreciation.  That means the basis of your backhoe is now 18,500 and you will recognize and realize a 3,000 loss.  Let's say you had bonus depreciation and your total depreciation taken is 13,000.  Then your basis is 10,500 and you have a gain of 5,000.

TurboTax will help you to get the right amount reported.  To find the correct section of TurboTax, type "Form 4797" in the Search box (with the magnifying glass), and then click on the Jump to Form 4797 link.  You will be able to enter the information there.