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posted Jan 22, 2024 4:55:20 PM

Sale of car used for business and personal

I bought a car in 2007 which I used about 80% for business. (Business miles per year were about 3000 miles). Purchase price $50,000 in 2017 and vehicle sold for $11,000 in 2023

Turbo tax shows a little over $8,000 gain for the business.

I went through each of the 16 years and multiplied the business miles for each year x the milage amount (.19 to .27) for the multiple years.  Total amount for the milage deduction was $10,945.01. Turbo tax added this amount to my income and increased the amount of tax due over $2,000. Does this seem right? Am I missing something? 

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1 Replies
Expert Alumni
Jan 22, 2024 5:27:54 PM

If you purchased the vehicle for $50,000 and used it 80% for business, the basis for depreciation would be $40,000. If you subtract depreciation of $10,945 from $40,000 you would get an adjusted basis of $29,055. This is more than the sale amount, so it doesn't seem like you should have a gain. I suggest you make sure you entered the correct cost for the vehicle and use percentage.