Business Auto Trade-In Rules

[WhiteOleander]

Page 10-9 of TaxBook.discusses the two differnt options for treating a business use auto that was traded in.

It states that the Method #1 election expired on February 26, 2007.

Does anyone know if this was extended in that last bit of legislation that passed in Dec.?

Thanks.

[Brad Imsdahl]

The 2006 version of IRS Publication 463, page 19 describes this method, and says it is based on Temporary Regulation section 1.168(i)-6T(d)(3). A temporary regulation is something set by the IRS, not Congress. Temporary regulations are just that, temporary. They give commentators time to voice their opinion on the IRS interpretation of the law. They expire when the IRS issues final regulations, or when time runs out.

My latest set of regulations from RIA dated January of 2007 still has the February 26, 2007 expiration date for these temporary regulations.

[WhiteOleander]

Thanks Brad for clarifiing that.

[Black Bart]

Ohhhh Nooooo!

My latest set of regulations from RIA dated January of 2007 still has the February 26, 2007 expiration date for these temporary regulations.

I can't stand to go back to that clunky, bumfuzzlin', idiocy of a depreciation method (writing off a "phantom" car).

I refuse to go peaceably. I'm goin' back to pre-'81 SL and they can just come and get me.

[Bees Knees]

Good news. Final regs were issued effective on February 26, 2007 (TD 9314). The final regs basically adopt the temporary regs. The election is now permanent that lets us elect Method #1 on page 10-9 for Business Auto Trade-In Rules. (worksheet on page 10-2)

[WhiteOleander]

Hey, Thanks for the update.

[S T]

Good News

I agree with Bart, I am not going back to the old rule, so I am very glad that this reg became permanent.

Sandy