Reporting Vehicle Trade In

[S T]

Have a client - Two Vehicles

One Vehicle trade in - for New Vehicle - Sched C - been using SMR - approx 40%

Second Vehilce trade in - for New Vehicle - Form 2106 - been using SMR approx 60% - has employer remibursement on gas

How to report for the depreciation factor - - Like Kind Exchange

Thanks

Sandy

[TaxGuyBill]

How to report for the depreciation factor

You need to go back and look at the business miles for each year, and multiply those miles by that year's depreciation amount (see link below). Then add up all of the years, and that is the total depreciation.

http://www.smbiz.com/sbrl003.html#dsm

[Gretel]

worksheet

Also, there is a nice worksheet in TTB pg.10-9 1040 edition - Business Auto Trade-In Worksheet.

[S T]

Thank you both

I have the worksheet completed on both - use TTB and also CFS Tax Tools

Guess my question is do I need to prepare form 8824 LKE when it is trade in with SMR

I really dislike Auto Trade-Ins!

Sandy

[Gretel]

Thank you both

I have the worksheet completed on both - use TTB and also CFS Tax Tools

Guess my question is do I need to prepare form 8824 LKE when it is trade in with SMR

I really dislike Auto Trade-Ins!

Sandy

Amen, me too, big time. Yes, form 8824 is needed unless something changed.

[S T]

Guess that is my question, how to complete the 8824 when using SMR on auto trade
Some say no 8824 needed when using SMR?

Sandy

[Gretel]

Sandy, if you want to give me your e-mail I can send you my calculation and my form 8824 with all the worksheets from my software. I did not fill in a worksheet but have a handwritten one following the instructions from TTB. Doesn't look nice because I made mistakes and just crossed out numbers. The biggest confusing issue for me was/is that the basis for depreciation differs from the basis used for the gain that is postponed. May that last sentence already helps.

[TaxGuyBill]

I've got a handy-dandy spreadsheet that I created to do all of the dirty work. Unfortunately, I was trying to "improve" it and now all of my calculations are not working right. I'll see if I can figure out what is wrong and fix it. If I can fix it, I'll post the link for it. Unfortunately, I don't have a lot of time (or brain power) right now to tinker with it.

Form 8824 isn't difficult because of the Standard Mileage Rate, it is difficult because the vehicle was not used 100% for business.

[S T]

Thanks Gretel and TaxGuy

I have CFS Tax Tools, so that made it a little easier!

Sandy