When it asks me if I traded it in I should say "no" correct? Then have to figure a like kind exchange?
You should say it was "not traded in" when answering that you stopped using that vehicle for business. However, you would not have to figure a like kind exchange, since you did not actually exchange that vehicle for another one.
You should "dispose" of that vehicle for your business. You can do that by selecting "Edit" next to the vehicle that was wrecked and enter the date it was totaled.
You will then enter your new vehicle as a new and separate asset and answer those interview questions to determine whether the mileage rate or actual expenses will yield you a bigger deduction.
You should say it was "not traded in" when answering that you stopped using that vehicle for business. However, you would not have to figure a like kind exchange, since you did not actually exchange that vehicle for another one.
You should "dispose" of that vehicle for your business. You can do that by selecting "Edit" next to the vehicle that was wrecked and enter the date it was totaled.
You will then enter your new vehicle as a new and separate asset and answer those interview questions to determine whether the mileage rate or actual expenses will yield you a bigger deduction.
it doesn't give me an option to mark it as not a trade in
This answer conflicts with the answer to similar questions. Some answers say you can count the new vehicle as a trade in or like kind exchange if the new vehicle was purchased in a reasonable time frame.
So how do you do this- as an exchange, which it isn’t. Just wondering because I have a similar situation
I'm having the same problem. I used a vehicle for work and it was totaled. There is no option to edit vehicle was wrecked.
So I believe what I did a couple years ago was reported the wrecked vehicle as a sale. Used the insurance check settlement as the sales price. I owed some depreciation recapture since I didn't hold the asset for at least 5 years. Then I deducted the sales tax for new vehicle purchase.
I'm in the same situation. Can I deduct mileage for the rental car that the insurance paid for?
NO LONGER A VALID ANSWER. FOR 2018 THERE IS NO AUTO TRADE IN
For 2018 taxes the old answers are not valid!
Your middle class tax cut means you pay ordinary gain on your trade in and depreciate your new.
This means that you may no longer treat the trade-in of a business vehicle as a non-taxable event. Instead, when you trade-in an old vehicle for a new one, you must pay income tax on your gain, if any.