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 Richard Your Own Question
Richard, Tax Attorney
Category: Tax
Satisfied Customers: 55725
Experience:  29 years of experience as a tax, real estate, and business attorney.
Type Your Tax Question Here...
Richard is online now
A new question is answered every 9 seconds

purchased tractor 2005 for $150,000.00 sold in 2011 for $75,000.00

This answer was rated:

purchased tractor 2005 for $150,000.00 sold in 2011 for $75,000.00 had lien for $69,000.00 my profit $ 6,000.00... now time to pay capital gains to good ole IRS, how do i figure ? sold because small business no longer had work, is any help on gains if sold because no longer need for business? approx. how much would capital gains if I have pay

Welcome! My goal is to do my very best to understand your situation and to provide a full and complete answer for you.

Good afternoon. The lien is not really relevant. What is relevant is any depreciation you deducted on the tractor prior to sale. Your gain (or loss) is calculated on the Sale price ($75,000) less (1) the purchase price reduced by (2) the depreciation.

I hope this
has given you information that has been helpful to you. If the information
general than
please be aware that we are only allowed to provide information and not
specific advice.
If you
have a follow-up question, please remember that there might be a delay between
your follow up questions and my answers because I may be helping others or
taking a break.

If you do have any additional questions about my answer
please simply ask a follow up question without rating so I can provide
you with a fully satisfactory answer.
Please be aware that any rating of 1 or 2 is
reflected as a negative rating, reflects negatively on my performance, and I
receive no credit for my answers.

Thanks for allowing me to be of service to you. Please be
aware that the information provided here is not legal advice. Rather it is
simply general information. All states have intricacies in their laws and any
information given is simply information only and specifically is not

intended to be, nor does it constitute, legal
advice. This communication does not establish an attorney-client relationship
with you. I hope this answer has been helpful to you.

Customer: replied 5 years ago.

I have used all the depreciation on $ 150,000.00 so do I pay (gain) on $ 75,000.00?

Unfortunately, if you have fully depreciated the basis of the tractor to zero, your gain would be the $75,000. I'm sorry!
Richard and other Tax Specialists are ready to help you