How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask MequonCPA Your Own Question
MequonCPA
MequonCPA, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 2342
Experience:  CPA, Over 30 yrs experience w/individuals and small businesses. Masters in Tax.
5142404
Type Your Tax Question Here...
MequonCPA is online now
A new question is answered every 9 seconds

In 2008 I have a vehicle I purchased for $29,989.09. Trade

This answer was rated:

In 2008 I have a vehicle I purchased for $29,989.09. Trade in was allowed at $13000.00. Less Prior Credit or Lease Balance of $13,882.96. Net trade in -882.96. The old vehicle cost $34, 823.00. Depreciation taken in prior years was $12,285.00. How would I figure the basis in the new vehicle?
JB
Customer: replied 7 years ago.
Relist: No answer yet.

DearCustomer-

 

Your basis in the new vehicle is $37527.09. The adjusted basis of your old vehicle $22,538 ($34,823 - $12,285) plus the cash paid for the new vehicle $16,989.09 ($29,989.09 - $13,000). I have provided links to Form 8824 & instructions and IRS Publications 551 & 544.

 

http://www.irs.gov/pub/irs-pdf/f8824.pdf

 

http://www.irs.gov/pub/irs-pdf/i8824.pdf

 

See page 7: http://www.irs.gov/pub/irs-pdf/p551.pdf

 

See page 11: http://www.irs.gov/pub/irs-pdf/p544.pdf

 

 

Customer: replied 7 years ago.
In the above question/answer, shouldn't the adjusted basis in the new vehicle be $39527.00?

Sorry, wasn't quite awake yet. Yes, it should be $39,527.09.

MequonCPA and 3 other Tax Specialists are ready to help you