Overwrite Percentage of Vehicle Business Use

[PCF]

Regarding the disposition of a vehicle:  The percentage of business use of a vehicle varied over several years.  I have calculated the average, but TurboTax Deluxe uses the percentage of only the final year to determine the business portion of the vehicle purchase price.  This results in an inaccurate gain/loss.  How and where can I overwrite this percentage to get a true gain/loss?  I know user SR_22 posted a similar question on Feb. 3, but there are no replies to date, so I have provided a bit of additional detail.  At this point, the only solution I can see is to alter the purchase price to get a correct final figure and keep detailed notes.  Obviously this is not ideal.  Ideally, TurboTax would allow the correct average to be used instead of the final year percentage.  Thank you for any help!  

[ThomasM125]

The program should ask for the purchase price of the vehicle when your report the sale. This is what I did:

1. Found the "Vehicle Expenses" section for the business where I use the auto

1. Went to the "Vehicle Summary" and clicked on "Edit"

2. Next screen said "Tell us about your vehicle" and had an option "I stopped using this vehicle in 2019"

3. Work through that section and when you come to the sale part, it asks for the cost of the vehicle

[PCF]

Thank you for this.  There is inconsistent treatment in this section.  On the sales price, it has me enter the business portion of the sale, but for the purchase price, it asks for the total vehicle cost and then automatically applies the 2019 business use percentage to that cost. 

So let's say I have a $100,000 vehicle used for 3 years at 25%, 50%, and 75% business use (average 50%), and then sell it for $50,000.  I can correctly enter that the business portion of the sales price as $25,000, but then I have to enter the total vehicle purchase price as $100,000 from which it then calculates the business portion.  Because the program only knows the 2019 75% business use from the mileage I have entered, it then inaccurately assigns the business portion of the purchase to be $75,000 instead of the correct $50,000.  I would be OK with the program not carrying over the previous years' mileage if it would let me enter the correct average percentage, but it doesn't.  Early on in the section there is a checkbox to mark that the years have different percentages of use, but it does nothing.  Since I can't reduce the business percentage of the purchase price from the 75% to 50%, I have had to alter the purchase price to arrive at the correct amount. 

The program needs to allow the user to enter an average business percentage use rather than assuming all years are the same as the final year.  Thank you again for your help!

[kathy-102]

YES. I am having this same problem. How do we get some attention from T.T. employees so that this can be corrected? 

[PCF]

Kathy,

It doesn't look like they are going to address this and I'm ready to file.  FYI, I went ahead with my inflated purchase price to get the correct answer and am just keeping a detailed spreadsheet of my calculation for documentation.

[kathy-102]

Hi. Thank you for responding about this. It's very helpful, and I appreciate it.

Kathy

[luis19]

Well it is a year later from your original posts and I'm having the same issue. I really do  not want to inflate the purchase price of my vehicle as a workaround. The software seems to think I used my car for business 34.54% of the time instead of that actual 74%. I'm curious if everyone else had the same random percentage assigned to you or some other wrong percentages? I've never used my car for anything below 70% in any year so I'm not sure how it arrived at 34.54%.

[ErnieS0]

@luis19 As @PCF said, TurboTax picks up the final year percentage for calculating gain or loss for the disposition of a vehicle. The cleanest solution is to delete your vehicle all together and re-enter your information. Copy everything down before you do that.

Once you get to vehicle sale section, enter the actual depreciation based on your records or as calculated (if you are used standard mileage).

To determine the depreciation equivalent of your standard mileage deduction for any year you used the standard mileage rate, multiply the applicable amount below by your business miles:

  2020..........27 cents
  2019..........26 cents
  2017-2018.....25 cents
  2015-2016.....24 cents
  2014..........22 Cents
  2012-2013.....23 Cents
  2011..........22 Cents
  2010..........23 Cents
  2008-2009.....21 cents
  2007..........19 cents
  2005-2006.....17 cents
  2003-2004.....16 cents
  2001-2002.....15 cents
  2000..........14 cents
  1994-1999.....12 cents
  1992-1993.....11.5 cents
  1989-1991.....11 cents
  1988..........10.5 cents
  1987..........10 cents
  1986...........9 cents
  1983-1985......8 cents
  1982...........7.5 cents
  1981...........7 cents

For tax years before 1990, these rates applied only to the first 15,000 miles. For tax years after 1989, these rates apply to all business miles.

Use these amounts for both your regular tax depreciation and your AMT depreciation. However, the total amount you enter cannot exceed the depreciable basis of the vehicle.

Remember, if you used the actual expense method in any year, you must use the depreciation computed for that year instead of the mileage amounts.

[luis19]

Thanks Ernie. I did try removing the vehicle and adding it back in but it kept calculating my vehicle business use percentage at 34.54%. It never allowed me to modify the percentage and that number is strange since it was never 34.54% in any year. I calculated what the correct overall percentage should have been and then modified the purchase price of the vehicle so it would arrive at the correct end result. It's unfortunate that I had to do manipulated the formula this way but in the end I have the correct result so the actual tax implications are correct. If I ever need to, I can prove that my math is correct and I've saved all my equations on a spreadsheet which I will keep with my records for this year. 

[adigilio]

After hours and hours hunting for a solution, asking the same question as the rest of you with the mysterious wrong "business use percentage" calculation, and reading multiple responses from TT's experts (including the virtually useless "delete vehicle and re-enter" b.s., someone figured out that: IF you answered "NO" you didn't keep track of "personal miles", by changing that to YES, the program resolves the error!  OMG.  How freaking stupid, but indeed this works, without having to inflate sale price of the disposed vehicle, and other trickery that people have tried out of desperation.   I hope TT folks are paying attention to this glitch and FIX IT.  Very disappointed 25 year TT user.