Loss

[RNuse09]

Hello,

What should I do if client bought a camper for work on June 09 for 10,490. Used it for the job for a year up until June 2010. Then he says that it was written up that he sold it for 3,000. Would you feel comfortable having this loss?

[BOB W]

Hello,

What should I do if client bought a camper for work on June 09 for 10,490. Used it for the job for a year up until June 2010. Then he says that it was written up that he sold it for 3,000. Would you feel comfortable having this loss?

No, I wouldn't feel confortable but it is not my problem if he has proper documentation. You should KEEP a copy of the bill of sale for you records.

The camper sounds like a personal asset but it depends what the business use was.

Several issue here, so can you provide more background info?

[RNuse09]

Purchased the camper for a job 200 miles away. That is the only time he uses the camper. This is the first year he is getting depr from the camper. Bought the camper for 10,490 in June of 09. Says he the sale is written up for 3,000, so I'm sure there was cash that exchanged hands. This is my first year on my own so I'm a little unsure of what to do. Thanks

[rgtaxservice]

Then he says that it was written up that he sold it for 3,000.

Ask to see the notarized tag documents. Here in PA when tags are sold, the buyer and seller have to notarize the sale so the transfer tax can be collected and remitted to the state. This will at least get you the actual sale price.

[kpangelinan]

Do you know any details?

Hello,

What should I do if client bought a camper for work on June 09 for 10,490. Used it for the job for a year up until June 2010. Then he says that it was written up that he sold it for 3,000. Would you feel comfortable having this loss?

Hard to tell from how you worded your conversation with him, but it almost sounded as if he mentioned something he did wasn't kosher.....if not, if there is proper documentation (bill of sale with buyer and seller contact information), and you know nothing else (the key here in this situation maybe), then why wouldn't you accept the customer's docs and prepare a proper return?

Good luck.

[ttbtaxes]

First, I would need to see both the purchase and sale documents to feel comfortable with the "loss" amount. Second, when you say it was for the "work" what does that mean? Was it a asset used in his Schedule C ? In his capacity as an employee?

What was the business purpose of buying it to begin with? Was it claimed in any manner on his 2009 tax return? If so, how?

More details would be helpful.

[BP.]

This is the first year he is getting depr from the camper.

He used it for business in TY 2010, which you say is the first year that he is taking depreciation, and then sold it in 2010? See TTB 9-11 under "Excluded Property." From the info you posted, sounds like the camper may not be eligible for depreciation. What about the possible business in 2009?

[RNuse09]

There was no depreciation last year but it was placed in service 06/09. I disagree with the previous preparer not allowing the depreciation. So I don't believe this is excluded property. He needed to stay in the camper to be able to do the job. Like a salesman staying a hotel.

[BOB W]

I would not give him the trailer as a deduction because the issue is clouded. Give him the per deium for each day of his temporary job, he may come out better anyway.

[Dusty2004]

2nd home

If he used it to stay in at a different site is it not a second home. Personal and not deductible for a loss?

Dusty

[BP.]

Admittedly unsure how to handle, but analogy: If I live in NY and took an 11 mo job in FL where I purchased a condo to stay in there, and then sold at loss when assignment done, would I be able to deduct loss? Think Bob W & Dusty2004 are on the right track with how to handle.

[Dusty2004]

Me - I say no

Admittedly unsure how to handle, but analogy: If I live in NY and took an 11 mo job in FL where I purchased a condo to stay in there, and then sold at loss when assignment done, would I be able to deduct loss? Think Bob W & Dusty2004 are on the right track with how to handle.

It is a second home. I have one this year exactly like this. The husband works about 250 miles away. Bought old home to fix up while living there for work. Sold at a $5,000 loss.

Personal loss no deduction.

Dusty

[Gretel]

I can see your point why it would be a personal loss.

I also could see how this is business loss. If I work temporarily for11 months outside my metropolitan area and stay at a motel, all expenses would be deductible.

To save on lodging expenses (and this is the only reason) I would buy a house or trailer or boat, believing I will sell at least for price I purchased for within a reasonable time after assignment is over. I will save on my expenses, the government will save on my expenses, why would that not be considered a business loss?

Of course, if the area I work in doesn't sell any houses, my assumption above would be stupid and unreasonable and loss, if incurred, should be denied.

On the other hand, if houses are sold faster than someone can blink with an eye, then assumption above is very reasonable.

I think this is a fact and circumstances situation.

[Burke]

It is a second home. I have one this year exactly like this. The husband works about 250 miles away. Bought old home to fix up while living there for work. Sold at a $5,000 loss. Personal loss no deduction.Dusty

I agree. Had one of these too. OP says he bought in 6/09 and sold in 6/10. Sounds like job may not have been less than one year, so travel expense not deductible. In any event, no depreciation, as it was not used "in his business." 2nd home, IMO.