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10/22/2018

Comments

Julie Dale

Thank you for the comments! You are correct that I should have considered the Section 179/bonus on the new truck. My example would have been better with it traded in for a BMW sedan. Then the auto limits would kick in and there would be a true tax liability from the transaction.

Ralph Preuss

I agree with the recognition of the $45,000 gain on the trade, but they would also have the ability to offset that gain with bonus or Section 179 on the 2018 Silverado. So to say this trade would cause them to incur $9450 of taxes is not entirely correct.

Ron

Of course, they would still be able to deduct the cost of the Chevrolet, which will be at least as much as the trade in allowance for the Ford, which could reduce the self-employment tax, as the sale of the Ford would be on 4797. Couldn't this be a benefit anyway?

What am I missing?

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