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Author: rosow Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121061  
Subject: Section 179 & Turbo Tax Date: 2/2/2002 1:35 PM
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Good afternoon all,
I'm a little confused about section 179 and recapture rules, if any on 100% use. In 1997 we had an $34695 1245 asset (Truck) used 100% for business purposes that we wrote off $18000 in the first year as a section 179 deduction (it was over the allowable 6000 lb limit). The depreciation basis was therefore $16695.00. We also wrote off $3339.00 as a normal depreciation that first year and as of the end of last year (2000) had depreciated $13810 of the $16695.00. We sold the vehicle the first week of January in 2001 for $23000. Turbo tax gave a 2001 depreciation of $962.00 and shows a profit on the sale of only $3077.00. My questions are these:

1) Why is there depreciation in 2001 when we sold the truck in the first week of the year.

2) Why doesn't turbo tax take into account the original section 179 deduction of $18000.00 in figuring out our profit on the sale.

3) Is there a recapture rule for the $18000.00 and turbo tax just has a glitch in the program right now. It is not treating the $18000 as already been depreciated. Here's what they show:

Purchase Price - $34695.00
Depreciation - $14772.00
---------
Adjusted basis - $19923.00

Sales Price - $23000.00
Adjusted basis - $19923.00
---------
Total Gain - $ 3077.00

Is this correct or should the total gain include the $18000.00 as recaptured income?

Thanks in advance!

Lenny
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