I need help on what to report as other income for the trade in of a business vehicle in 2011.

So I purchased the vehicle for 27000 in 2007 started using it for business in may of 2009. In 2009 i used the standard vehicle mileage deduction (no depreciation)
In 2010 my business usage was 18.1% which made my allowable amount of $4911 of which i depreciated 873 for 2010.(i used the actual cost method for 2010)

I traded-in the car in May of 2011. According to the paperwork they allowed me 15500 for the vehicle (i owed 17075 so 1575 was added onto my new car loan)

My business use percentage for 2011 for the car traded in was 14.77%

I am was just a few credits from getting my accounting degree when I had to quit school to raise my babies (10 years ago) So all this tax stuff with daycare comes pretty easy to me but this one I need a little direction on how to calculate.

Also for the vehicle I traded this one in for do i use my adjusted basis as the amount of purchase plus the negative equity I had the other car? (the total is still under the fair market value of the car)

These two things are the last 2 things that are holding me up and then I am all done with taxes for 2011. Woohoo!

Thanks!

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Was really hoping Tom could answer this one! Im in exactly the same boat! I have read all the irs codes and publications and it appears to be differebt when the % pf use changes every year and it is and always has been under 50% business use. The first yr of my business i used the standard rate and then the actual with depreciation for the 2nd and subsequent years. Thanks in advance Tom!

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Here are a few threads that might help: https://www.daycare.com/forum/tags.p...eduction+-+car

https://www.daycare.com/forum/tags.p...ace+percentage

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