Stuck on Sched. C - "Depr allwed or allowable is too large" but I cannot change it

[squidlady]

I am self employed and traded in the car I used for business last year for a new car, which I use for business for now. I've written off my old car's expenses for years. Now the error checker is stuck on Schedule C and I cannot edit the fields. It is lines 51 and 52 of Schedule C. The amounts are the same as the amounts in lines 37 and 39. These lines were automatically populated by the software. The error message I get is "Schedule C - (my name and business) - Car & Truck Expenses Worksheet (my car)  Depr allowed or allowable is too large. For disposition calculations, depreciation cannot exceed business basis. Please see Tax Help for this field"

I cannot find any tax help in the software and am unable to edit the numbers on lines 51 and 52. Please help! I have no idea what to do.

[MarilynG1]

The Calculated Depreciation (for disposition) can't be larger than the FMV of the Business Vehicle when it was placed in service.

Try Deleting/Re-Entering the Vehicle with a FMV (when placed in service) that is larger than the Depreciation Amount calculated.   

Check the Car and Truck Expenses Worksheet, Line 33 and 35 for these amounts.

Enter the amount you received as Trade-In as Sales Price.  

[squidlady]

@MarilynG1  Thank you very much for your reply. I always import my returns from the previous year into each year's TT. I have further questions.

1. Would me deleting and re-entering this information mess anything up in the rest of the return? TT even states that "because you transferred... we have enough info..." so it is using data I had input in previous years.

2. I bought the older car in 2006, how could I find out the FMV at that time, would I have to pull my 2006  tax return?

3.  I didn't put the total amount I received as "sales price" because the software instructed me to show the BUSINESS PORTION only - should I change that to what I actually got for the trade-in?

4. I also don't understand how the trade-in value of an old car is taxable income? Is that correct? "since it is a gain, it is taxable income" - maybe I've made an error somewhere?

5. What would happen if I just deleted the vehicle entirely? I have been using my new one for business for several months. 

Thanks again.

[MarilynG1]

You would not have a gain on trading in your older vehicle that was fully depreciated.  You just want to remove it properly from your Business Assets. 

You can enter a Sales Price of $0 in this case.

In the Assets section, you may be able to change the FMV that you originally used; if so, you wouldn't need to 'Delete/Re-Enter' the vehicle. 

You don't need to try to find the FMV of your vehicle from 2006; since you are disposing of it, just enter an amount that is larger than (or equal to) the Calculated Depreciation.

[squidlady]

@MarilynG1  Thank you again. I was able to change the "sales price" to zero with no issues.

Now for the FMV. Let me tell you what the various lines of my Part IV (Car and Truck worksheet) show and ask for your opinion.

33a and b are blank. 33c shows "22053"

34 is blank

35 is "1326" (it is NOT a luxury car so I don't understand where this came from)

37 is "17201"

38 is zero

39 is "17201"

51 and 52 are "17201" and I cannot edit those lines.

Down further

64 is MACRS

65 is "5"

66 is "200DB"

67 and 68 are blank

69 is "5.00"

70 is "14" (I actually understand that one!)

71 is "16480"

When I try to change the "17201" in the TT blank (not the form itself) I am unable to do that. I am also unable to manually edit lines 51 and 52 in the form at this point.

Is this enough info for you to identify which exact lines I need to change, and what to put? Sorry but I am not certain which line is the "calculated depreciation" you refer to. I am also unable to add a "flag" to this page. Nothing happens when I try clicking on Flags. I've done it many times in previous years.

I guess it's Greek to me...thank you again.

[kentheng]

I am having this exact same problem.  It did not show up until an update from Intuit was run today.  I'm wondering if there is a software / programming glitch, rather than a problem at the entry level. 

[squidlady]

@kentheng Thanks for posting - I'm always glad to know that someone else is in the same situation as I am!

[squidlady]

@MarilynG1 I still need tne answer or I cannot file my taxes. TT is getting stuck, as I said above, and I cannot "unstick" it without the information I asked about above. I cannot edit the stuck field - the software will not let me- and I certainly cannot submit my taxes this way. I don't know if it is an entry I need to change, and if so, which one, and how - or if it is a software issue as someone suggested above.

Please help. Thank you.

[MarilynG]

I think you need to speak with someone who can actually look at your tax return; we can't see your return in this forum.

Click this link for  Phone Support  or here for instructions on  How to Get a Live Review  .