Does selling your old car count as income and do you have to pay income tax on that?

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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.
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How do you pay yourself and what are the taxes on that income?

Self-Employment . When you have a business or you perform a service and you receive payment, that is considered self-employment. When you file your income taxes sometime between December 31 and April 15, you will complete a schedule for self-employment, which will give you the rate you are requi ( Full Answer )

Do you have to pay federal income tax?

Yes. In the United States, the Federal Government pay levy taxes on income. As the initial proposition for what became Amendment XVI had no time limit, and since more than 3/4 of the states have passed ratification of the proposition, the United States Supreme Court recognizes the power of the ( Full Answer )

Can you count combat pay towards earned income credit but not for child tax credit?

As a frequent contributor here, I must first apologize for my last response to a combat pay question. I messed that up bad. The whole military pay topic sub catagories like combat pay, which also has many subs and a tax world unto itself.. I believe the answer to this Q is that you can ele ( Full Answer )

Do you have to pay income tax on IRA income?

On a standar IRA, Yes (you didn't pay tax on the $ contributed or as it grew). On a Roth IRA, (where you paid the tax on the income before contribution), No.

When do you have to pay federal income tax?

Your taxes must be paid through out the year. That is, by either payroll withholding or making estimated payments on your estimated amount due quarterly...with a Form 1040-ES.. Not making payments through the year will incur a penalty and interest charge whenever you do eventually pay. That would p ( Full Answer )

Do you have to pay income taxes on a sale from repo'd car?

Your Q almost makes no sense. Only if your car was repoed and sold for more than the debt/basis, did you receive anything yourself...and then the question would still be what your basis is in it (that is your cost plus all those other things like the repo fee's, vs what you received). If your ( Full Answer )

When do you have to pay your income tax liability?

The dates your Estimated Tax Payments would be due is :. April-15. June-16. September-15. January-15 of 2009. Your tax liability is due when you file your tax return and have a liability due with that return. IRS 1040 income tax returns are due on April 15 of each year for the previous year. Th ( Full Answer )

Who can pay Income return of tax?

Hi frnds, for individual whose income is more than 110000(2008-09,fiscal period) for women 1450000 must file income tax form by 31 july(for audit 31oct) . for not filling return may penalty of 5000. THANKS

Income before you pay taxes?

Simple Common Sense: It really makes no difference since the only time you actually do WANT to file is when the IRS says you don't have to! They don't do that because it's good for you. They do it because it is more likely to be good for them . Certainly if you don't have to file, NOTHING BAD, ( Full Answer )

Do Americans pay income taxes?

Some do. Some don't. I don't recall exactly what the number is but I think if your income is less than about $13,000 you are not required to pay income tax. You can probably find the exact number at

Why pay income taxes?

Why use highways, bridges and airports, accept the protection of the Armed Forces, go to schools that get Federal money, or any of the other thousands of things you take for granted that are paid for with tax dollars?

What is percentage of income tax we pay?

After your 1040 federal income tax return is completely correctly to the line 43 page 2 of your 1040 income tax return TAXABLE INCOME amount. You will have 6 different percentage of marginal tax rates from 10%, 15%, 25%, 28%, 33% and the maximum 35% for the the tax year 2010 at this time July 31 201 ( Full Answer )

Does a 16 year old have to pay income tax?

If the 16 year old has sufficient income, yes. There is no age limit on who has to pay income taxes. Even if the 16 year old is not required to pay income tax, he can file an income tax return to get back any withholding that was taken out of his salary. Refer to Tables 1, 2, and 3 on pages ( Full Answer )

What taxes do you have to pay on pension income?

Income taxes, generally. Some states exempt some pensions from income tax.. If you are in the UK and are only receiving the State Pension as your income in retirement it is unlikely you would pay an taxes as the amount paid will be below your yearly tax allowance. If you add to the State Pension an ( Full Answer )

Do you pay income tax in Texas?

Every1 in the world pays income tax . Texas does not have a State income tax, collecting that same revenue using other tax means. You of course pay Federal income taxes.

Who pay tax on income property?

The owner of the property pays the tax on the income generated by the property. This is known as the "fruit of the tree doctrine."

What is the fines for not paying taxes on your income?

The federal tax penalty is 0.5% per month (not per year) of the balance due, increasing to 1.0% per month after an intent to levy notice is issued. In addition to the penalty, interest is charged at a rate that varies quarterly. The current rate is 4% per year. In addition, if you are convicted i ( Full Answer )

What does income tax pay?

It pays for all the things that appear to be free - (in the UK) police, fire and ambulance services, health service, armed forces, etc. etc., plus subsidies to things like rail travel, roads, etc

What countries do not have to pay income tax?

Communist ones, as they basically do so by controlling what you do and what you recieve....essentially after tax.. And of course, countries without any effective government to enforce the tax laws they probably have...or enforce any other control. Bring your own police force to protect yourself!. ( Full Answer )

Are we supposed to pay income tax?

There is a HUGE misconception that we in America are obligated to pay income taxes. The truth is we are not. Without going into all the details its really this simple. If the money you make from your occupation is the result of dealing directly with the Federal Government then yes you owe tax. If ho ( Full Answer )

What income to pay income taxes?

Income is paid on income accrued or arises in the hands of person resident in India or in special cases non residents. Chapter No II of the Income Tax, 1961 defined the basis of charge. The scheme of taxability of income in India is being given in the following chapters: Ch. No. II BASIS OF CHAR ( Full Answer )

Do blacks have to pay income taxes?

Yes they do the same as any one else that has any gross worldwide taxable income to be reported on the 1040 tax form.

Do you have to pay taxes if you are low income?

The answer depends on how much money you earned, your source of income, and your number of dependents, if any. You may be eligible for a tax credit under certain circumstances. Your best bet is to call the IRS and ask.

Do you pay taxes on disibility income?

Yes this could be very possible that some of your disability income could be taxable income on your 1040 income tax return.

At what gross income do you pay income tax on?

You are the only one that has all of the necessary information that will have to be reported on your 1040 FEDERAL income tax return for the year in order to do the calculation for the numbers that you are looking for. After you complete your 1040 federal income tax return correctly to your TAXABLE ( Full Answer )

What taxes do you pay on deferred income?

Deferred compensation income that is contributed to your retirement plan is subject to the social security and medicare taxes in the year that the amounts are contributed to your retirement plan. When you reach the retirement age and start receiving distributions from the retirement plan the taxable ( Full Answer )

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 ( Full Answer )

Do children have to pay income tax?

Yes it is possible that children could be required to file a federal 1040 income tax return and pay some income taxes on the taxable worldwide income from all sources that they receive during the year. A dependent on another taxpayer income tax return with unearned income interest, dividends, capi ( Full Answer )

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 ( Full Answer )

Do the elderly have to pay income tax?

Yes it is very possible for the elderly to be required to file a 1040 federal income tax return and have to pay some income tax on the TAXABLE AMOUNT of all of the gross worldwide income that they are required to report on their income tax return. As long as you are still breathing these would be ve ( Full Answer )

Do the wealthy pay income tax?

The wealthy do pay income tax, and since the wealthy have more income, they must pay more money in income tax.

Does an income of 9000 have to pay taxes?

This answer would depend on your filing status as a dependent on another taxpayers income tax return YES and you would also have to pay some income tax on the taxable amount after your 1040 income tax return is completed correctly. For a single taxpayer under the age of 65 you can have 9350 of world ( Full Answer )

Do you pay income tax on FiCA?

Federal Insurance Contribution Act (FICA) Yes it is possible when you start receiving your social security benefits that you qualify for. From 50% to 85% of the amount that you receive COULD become taxable income on your 1040 federal income tax return WHEN you are receiving any other sources of worl ( Full Answer )

Is it illegal not to pay income tax?

Yes, you can be fined $$$ and even end up in prison if you don't pay your income taxes. Wesley Snipes was convicted and sentenced to 3 years in prison in 2008 for not paying income taxes. Freedom isn't free. Pay your taxes.

What if you stop paying income taxes?

The IRS (Internal Revenue Service) will A) Start repossessing your items in order to pay for your debts or B) Hunt you down and jail you after so long without paying your taxes.

How do you pay income taxes?

The IRS will sent you a form. If they don't you can pick up a form 10 40 at the post office. Fill it out or get a CPA to fill it out for you if you have a complicated business. Then mail in a check. You may also have to send in quarterly estimated payments. Also you may have had income taxes deduc ( Full Answer )

What if your employer does not pay your income taxes?

If your employer withholds taxes from your paycheck and does not pay them to the IRS, it is not you problem, nor should you worry in the least. The IRS will give you credit for any amount withheld from your paycheck whether or not they ever recover the amount from your employer. All you need to do ( Full Answer )

What is the deadline to pay income taxes?

In the US, generally speaking, the bulk of the tax due (exactly how this is defined is complicated, but generally you're okay as long as you paid at least as much by the end of the year as you had to pay the year prior) is supposed to have been paid prior to the end of the year, and any remainder is ( Full Answer )

When do you start paying income taxes?

There are no age (young or old), or start and stop times for income tax. It is all a matter of Taxable Income (not a matter of working - many people who don't work have or make a lot of money). it is entirely possible and not at all unusual that a newborn that inherits or is gifted money/property, ( Full Answer )

Why do Americans have to pay income taxes?

Academic research points to three reasons for the income tax; in descending order they are: 1) Political favoritism, 2) Social order, 3) Revenue generation. Kinda blows doesn't it?

Is it voluntary to pay income taxes?

No, it is mandatory. There is a federal income tax, and you are required to pay it when you file your taxes each April. Failure to do so could submit you to an audit from the Internal Revenue Service and you would undoubtedly have to pay late fees and penalties if it turns out you failed to pay your ( Full Answer )

What do American income taxes pay for?

American income taxes pay for government services and protection,defense/military spending, roads, schools, and law enforcement.