How do I figure out the capital gain on my vehicle that was totaled when my business mileage varied from year to year?

[taphair]

my vehicle was totaled in a car accident. I used this vehicle for both personal and business over the years and the business use percentage varies each year so how do I figure out how much of a capital gain to the business I should put

[HelenaC · Accepted solution]

If you used the standard mileage rate for the business use of your car, depreciation was included in the standard mileage rate. 

You'll have to pull all your tax returns and using the IRS Depreciation Adjustment for Standard Mileage Rate (screenshot below), calculate the amount by which you have to reduce your cost basis. 

Since depreciation accumulates, each year's business mileage affects the adjusted basis of the vehicle. The adjusted basis will, in turn, be used to determine the gain or loss when the vehicle is sold or disposed of, so keeping good records is essential. 

• The 2018 portion of the business standard mileage rate that is treated as depreciation is 25 cents per mile. For tax years 2017 and prior, see the screenshot below.

• Note: my screenshot also has an example that shows how to do the calculation.

See Business Use of Vehicles  https://turbotax.intuit.com/tax-tools/tax-tips/Small-Business-Taxes/Business-Use-of-Vehicles/INF1207...

[asparrow08]

When calculating depreciation for the standard mileage, do you only deduct the depreciation for the business miles?  

When calculating the proceeds from the sale, do you only take the business %?  For example, if you sold a car for $10,000 and it was used for business 50% of the time, would you calculate the gain using $5,000 as the sale price?  

[DaveF1006]

In calculating depreciation, you would only use the depreciation equivalent of the mileage. Look on page 24 of this IRS pub to determine depreciation equivalents for yrs 2014-2019. As far as proceeds, you would enter $10,000 as the sale price and enter the percentage of business use at 50%. Turbo Tax will allocate it correctly.