How does gain/loss work for a repossessed vehicle that was used a percentage of time in a self employed business with vehicle deductions?

You will recognize a loss on the business use portion of the vehicle and recapture prior year depreciation for the repossession. You can follow the steps below to calculate the loss amount in TurboTax:

• When you Edit your vehicle in Business Expenses, indicate that you 'stopped using it in 2022'.
• Enter a Sales Price as 0, and TurboTax will calculate any Loss for you.  Leave 'Basis for Gain/Loss' and 'AMT Basis for Gain/Loss' blank.
• If you claimed Actual Expenses for your vehicle, the Gain/Loss will be calculated on the remaining Cost Basis minus the Prior Depreciation claimed. 
   

If you claimed Standard Mileage, you will need to calculate and enter a 'Depreciation Equivalent' so TurboTax can calculate any gain/loss for you. The IRS provides a table with the depreciation equivalent rate in  Publication 463, Travel, Gift, and Car Expenses. For example, if your business mileage is 1,000 miles in 2021, your depreciation equivalent will be equal to $260. (1,000 X 0.26 (depreciation rate per mile for 2021 from the IRS table)