SECTION 179 RECAPTURE

[DONNA2021]

 I have a 18 wheeler owner that bought a truck in 2019 for $35,000.00. He want to use the whole $35,000.00 as section 179 on his 2019 tax return. On his 2020 tax return he did not use the truck at all. He did not sell it. He does have another truck that he used in 2020. So, he used the truck that was purchased in 2019 for $35,000 less than 50%. How do I recapture the $35,000 section 179. What form do I put it on ? Do I recapture the whole amount of $35,000 on the 2020 tax return?

[sjrcpa]

It goes on Form 4797 page 2 Part IV. As I recall you have to manually calculate the recapture and enter it, at least for Lacerte. See the form instructions for how to calculate.

[PATAX]

Look into the State handling of this also since some states do not conform to Federal Section 179 rules...

[TaxGuyBill]

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@DONNA2021 wrote:

On his 2020 tax return he did not use the truck at all.

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Was the truck still ready-and-available to be used for the business, if needed?  If so, I would still view it as 100% business use.

[DONNA2021]

Thanks

[DONNA2021]

I think his son used the truck, but the owner did not.