Donation of vehicles

Feb 17, 2009 1 Replies

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Taxpayer donates two vehicles to charity at end of 2008. First one is a

1994 sedan and the other is a 1996 truck. Both are running but have been heavily used. Both vehicles were used for business by the taxpayer who files a schedule C. TP took standard mileage on both vehicle over the years as a business expense. TP has letters from the charities acknowledging the donation and that is it less than $500.

Can the taxpayer take the fair market value of the donation on schedule A as a charitable donation for fair market value or because they took standard mileage rate do you consider it's basis as fully depreciated since they owned the car more than 5 years and took standard mileage and therefore not be able to take anything as a deduction.

Thanks for any input.

You have to report the dispositi .05 Depreciation. For owned automobiles placed in service for business purposes, and for which the business standard mileage rate has been used for any year, depreciation is considered to have been allowed at the rate of

16 cents per mile for 2003 and 2004, 17 cents per mile for 2005 and 2006, 19 cents per mile for 2007, and 21 cents per mile for 2008 and 2009, for those years in which the business standard mileage rate was used. If actual costs were used for one or more of those years, these rates do not apply to any year in which actual costs were used. The depreciation described above reduces the basis of the automobile (but not below zero) in determining adjusted basis as required by § 1016.

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they havedepreciation for earlier years. Since you say the cars are heavily used, I'll assume the depreciation equals the value of the car. Thus, the disposition of the cars results in a net gain of zero. If the cars were not fully depreciated, you may actually have a loss.

As for the deduction, I think you can take it on Schedule A.

Donation of vehicles

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