Question

Traded 1 vehicle used for 2 businesses

Forum|Forum|7 years ago
October 10, 2018
1 reply
0 views

At the beginning of 2017, I had a Toyota Sienna that I used for my grocery shopping business (Jan - Apr) and also for my pet sitting business (Jan - Sept). I traded it in September and only used the new vehicle for the pet sitting business. Since I stopped using the vehicle for the grocery shopping business at the end of April, should I state for that business that I traded it or not?

Carl11_2

Assuming both businesses are reported on SCH C as a part of *your* personal tax return, here's the simplest way to do this.

Show the vehicle as "removed for personal use" in the grocery business, since that's a true fact. Then when reporting the trade-in of the vehicle on the SCH C for the pet business, the recaptured depreciation you'll enter will be the total of all depreciation taken in both businesses. For figuring what portion of the "per mile" deduction is depreciation (which has to be recaptured) for each tax year, see https://www.smbiz.com/sbrl003.html#dsm and select the link for "depreciation deduction for standard mileage rates"