I purchased a vehicle in 2018 and used it for 100% business use in 2018 & 2019. I reported the actual business mileage for those years. I no longer use the vehicle for business purposes as of 1/1/20 and have used the vehicle for personal use. Do I need to report the recapture information? If so, how do I calculate the straight-line depreciation on the vehicle?
Converting the vehicle to personal use does not trigger a recapture of depreciation. When you sell or trade in the vehicle, that's when depreciation is recaptured.
To tie into this question I'm in a similar situation and rather than keeping the earlier vehicle as the author has, I traded mine in.
Its asking me for prior depreciation (which I have) and also me to calculate the straight-line depreciation to calculate the amount off difference (recapture) amount. Do I use the mileage multiplier by year X mileage used in business that year, adding up the 5 years I used in business and the total is my straight-line depreciation amount?
The only thing I've ever seen on determining straight line depreciation for a vehicle, "seems" to assume that vehicle was 100% business use, and it's not even on an IRS website. So I can't validate the accuracy of it. It's at https://smallbusiness.chron.com/depreciate-company-car-53368.html and make sure you read the entire article; not just the part related to straight line depreciation for vehicles.
I am self-employed. I purchased a new car in 2015 for $20,000. My car was stolen in 2023. Insurance reimburse me $9,000. Over the 10 years I use standard mileage deductions. I used the $9,000 to purchase another car. Will I have to pay recapture gains on my taxes. How do I report this