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Only if you made a profit; i.e., you received more than you paid for it. Then you would pay tax on the gain.
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∙ 15y ago
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Does an individual who sells a used car have to pay taxes on the money collected for the sale of the car?
Legally he has to pay income tax on the net profit from the sale. It is income and therefore is taxable.
Are taxes owed on the profit or gain from the sale of a car?
Any gain or profit from the sale of a car is taxable and reported as a capital gain on Sch D of IRS form 1040. It is usually taxable on most state and local income tax forms. If the the taxable income reported on the federal return is transferred to the state/local tax form, then there is no need to report it on the state/local return since it is included on the federal return.
What is the tax percentage on a settlement from a car accident?
The proceeds of compensation from an award for a vehicle accident are not taxable.
What is accounting journal for proceeds of car sale?
Because the car is a fixed asset, the depreciation of the vehicle must be recorded up to the date of sale. The proceeds should be recorded as credit if profit was earned or debit if there was a financial loss.
Do civil action lawsuit proceeds have to be claimed on income tax?
Depends on what the recovery or award was for. General guideliens are if it stated as for replacing property you lost, putting you back where you were (say damamges to your car), it is NOT taxable (presuming you have not taken the amount of that loss as a casulty deduction previously). If it replaces lost income, from work or say rental property (which would have been taxable if you had received it normally), or is punitive in nature, it's taxable. (Although some of the costs of recovery may be deductible).
Which of the following noncash fringe benefits does not represent taxable income subject to federal income tax withholding?
personal use of government car
How does an employee pay imputed income taxes?
Imputed Tax is on imputed income...say like a taxable employee benefit (say your employer giving you a car). The value of the benefit is included in taxable income that withholding and such is determined from...so your estimated payments are made on it...and it is included in the taxable income on your W-2, so the tax you calculate on your retur includes it as well.
When you sell a car do you have to claim it on income tax return?
With the exception of collectibles and/or antiques, cars usually lose value over time. However, if there is a gain or profit from the sale of any vehicle, the gain or profit is taxable and reported as a capital gain on Sch D of IRS form 1040. It is usually taxable on most state and local income tax forms. If the taxable income reported on the federal return is transferred to the state/local tax form, then there is no need to report it on the state/local return since it is included on the federal return.
Do you pay income tax when you sell your car?
With the exception of collectibles and/or antiques, cars usually lose value over time. However, if there is a gain or profit from the sale of any vehicle, the gain or profit is taxable and reported as a capital gain on Sch D of IRS form 1040. It is usually taxable on most state and local income tax forms. If the the taxable income reported on the federal return is transferred to the state/local tax form, then there is no need to report it on the state/local return since it is included on the federal return.With the exception of collectibles and/or antiques, cars usually lose value over time. However, if there is a gain or profit from the sale of any vehicle, the gain or profit is taxable and reported as a capital gain on Sch D of IRS form 1040. It is usually taxable on most state and local income tax forms. If the taxable income reported on the federal return is transferred to the state/local tax form, then there is no need to report it on the state/local return since it is included on the federal return.
Does Federal Income Tax get deducted from bonuses?
Sure...you can call income from your employer anything you want, (and it doesn't matter if you get paid by say, having the use of a car or house), it is income and taxable.
Why you pay tax when you sale your old car?
Any time you recieve moneys over $1000.00 it is going to be considered earned income. Unless it is non taxable interest from owning shares from a corporation. Also luxory tax might be put into consideration.
Does selling your old car count as income and do you have to pay income tax on that?
Whether the money received from the sale of your car is taxable or not depends on if the car was for business vs. personal use. If the car has been used in a business and there was a tax deduction taken for depreciation, you must report the recapture of depreciation from the sale on Form 4797 and calculate any gain or loss. A gain would be taxable; a loss may be deductible against your other income. Losses on the sale of personal property are not deductible, but gains from such sales are taxable. The gain is calculated by subtracting the amount of the sale minus the purchase price. It is rare to have a gain on the sale of a personal vehicle because no depreciation deduction can ever be taken for personal use items. Therefore, the cost/basis of the vehicle remains the same (what you originally paid for the car). For the vast majority of cars, the selling price is less than what the owner paid for it. However, classic and collector cars have been known to yield gains for their owners. If you happened to be fortunate enough to buy a car which became a classic and increased in value, you would have a reportable capital gain. For these types of gains, the amount of tax owed depends on how long the car was owned. If owned for a year or longer, the long-term capital gain treatment is applied and the taxes are less than if the car was owned for less than a year.
