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schiefelbein-ste
New Member

In 2018 our business car broke down. It was junked. Bought another used car for the business. How do I report the old car since there was no trade-in, sale or gain/loss?

This is related to our business taxes. Since we are no longer using the old car because it was junked, I added the new car, and I recorded the appropriate mileage. Now it is asking questions about the reasons for no longer using the old car. However, I didn't sell it or trade it in so I really don't have a gain/loss. How do I record this correctly?

1 Best answer

Accepted Solutions
MarilynG
Expert Alumni

In 2018 our business car broke down. It was junked. Bought another used car for the business. How do I report the old car since there was no trade-in, sale or gain/loss?

At the Vehicle Summary page, EDIT your old car (screenshot).

Then indicate that you 'stopped using this vehicle in 2018' and the date (screenshot). 

Continue through the interview, entering any expenses or mileage for 2018. 

Enter a Sales Price of $0, and the Original Cost of the vehicle when place in service (screenshot).

Leave 'Basis for gain/loss' and 'Basis for AMT gain/loss' blank on the next screen.

If you claimed Standard Mileage over the years, enter the 'Depreciation Equivalent', based on total business miles (screenshot).  You will need to do some calculation is this is the case. 

However, if your vehicle was fully depreciated (older and used many years), enter an amount equal to the Vehicle Cost you entered previously.

This will result in no gain/loss, but will close out the vehicle for your business.

**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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1 Reply
MarilynG
Expert Alumni

In 2018 our business car broke down. It was junked. Bought another used car for the business. How do I report the old car since there was no trade-in, sale or gain/loss?

At the Vehicle Summary page, EDIT your old car (screenshot).

Then indicate that you 'stopped using this vehicle in 2018' and the date (screenshot). 

Continue through the interview, entering any expenses or mileage for 2018. 

Enter a Sales Price of $0, and the Original Cost of the vehicle when place in service (screenshot).

Leave 'Basis for gain/loss' and 'Basis for AMT gain/loss' blank on the next screen.

If you claimed Standard Mileage over the years, enter the 'Depreciation Equivalent', based on total business miles (screenshot).  You will need to do some calculation is this is the case. 

However, if your vehicle was fully depreciated (older and used many years), enter an amount equal to the Vehicle Cost you entered previously.

This will result in no gain/loss, but will close out the vehicle for your business.

**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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