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I sold a semi truck that was leased purchased 35K I

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I sold a semi...

I sold a semi truck that was leased purchased 35K I purchased a new truck - the old had no depreciation - lease payments do I owe tax on the 35K for selling

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Purchased lease semi 2014 35K deducted lease payments sold this truck for 35K last year purchased new truck is the 35K taxable as income in business

Submitted: 4 months ago.Category: Tax
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3/17/2018
Tax Professional: Lev, Tax Advisor replied 4 months ago
Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 33,141
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Yes - that will be taxable income.

When you deducted lease payments - these partially were attributable to depreciation - so if fully depreciated - the full sale price will be taxed as depreciation recapture.

You woudl not be taxable if that old track is exchanged for a new truck - that will qualify you for section 1031 exchange.

Please verify.

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Customer reply replied 4 months ago
Was not traded but sold and new purchased
Tax Professional: Lev, Tax Advisor replied 4 months ago

The - it will be taxable,

and you will start depreciation deduction for the new truck separately.

You will need to report the sale on form 4797

https://www.irs.gov/pub/irs-pdf/f4797.pdf

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Tax Professional: Lev, Tax Advisor replied 4 months ago

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