Transfer Business Vehicle From One Business To Another

Posted by Brian on June 12, 2006, 9:18 pm

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I hope someone can help. I have been involved in two types
of business as a sole-proprietorship, one was a Schedule C
type business (non-farm) the other was a Schedule F business
(farm). In 2003 I purchased a heavy truck and took some
Section 179 deprecation within the Schedule C as the vehicle
was used 100% in that business, then in later years took
other deprecation. The Schedule C business was recently
sold and all assets except this truck were disposed of.
This truck is now used 100% in the Schedule F business. I
use Turbo Tax software. I can not determine how to
"transfer" this vehicle from the Schedule C to the Schedule
F. The only thing I can think of is to show the vehicle as
being disposed of on the Schedule C, then show it as a new
purchase on the Schedule F, but that is probably not correct
as the vehicle was not sold, I still own it, just use it
100% in the Schedule F business now. How would you
professionals suggest that this be handled? Surely there is
a way to handle this, or should I just show the vehicle as
being sold with respect to the Schedule F business, do the
depreciation recapture, and then show the vehicle as a new
purchase with respect ot the Schedule F business? If I do
that how would I determine the "basis" for the Schedule F
business? Anyone?

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Posted by bbs on June 15, 2006, 7:07 am

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Brian wrote:

> I hope someone can help. I have been involved in two types

> of business as a sole-proprietorship, one was a Schedule C

> type business (non-farm) the other was a Schedule F business

> (farm). In 2003 I purchased a heavy truck and took some

> Section 179 deprecation within the Schedule C as the vehicle

> was used 100% in that business, then in later years took

> other deprecation. The Schedule C business was recently

> sold and all assets except this truck were disposed of.

> This truck is now used 100% in the Schedule F business. I

> use Turbo Tax software. I can not determine how to

> "transfer" this vehicle from the Schedule C to the Schedule

> F. The only thing I can think of is to show the vehicle as

> being disposed of on the Schedule C, then show it as a new

> purchase on the Schedule F, but that is probably not correct

> as the vehicle was not sold, I still own it, just use it

> 100% in the Schedule F business now. How would you

> professionals suggest that this be handled? Surely there is

> a way to handle this, or should I just show the vehicle as

> being sold with respect to the Schedule F business, do the

> depreciation recapture, and then show the vehicle as a new

> purchase with respect ot the Schedule F business? If I do

> that how would I determine the "basis" for the Schedule F

> business? Anyone?

The answer depends. How was the truck titled? If it was
owned by the Schedule C biz then you probably did take the
trust as a distribution from the Schedule C biz prior to its
sale and you might have to pay tax on the dist (assuming
that it resulted in gain in excess of your tax basis in the
Schedule C biz).

Hope that helps.

Gary Brolis
http://www.MechanicsofMoney.com
http://www.MechancisofMoney.com/blog.php

<< ======================================================= >>
<< The foregoing is intended for educational purposes only >>
<< and does NOT constitute legal OR professional advice. >>
<< >>
<< The Charter and the Guidelines for submitting >>
<< messages to this newsgroup are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ======================================================= >>