When to Take Recapture on Pickup Truck

[beeefey]

What is the name of your state? Minnesota

Hello--

I was involved in an auto accident which the other party was 100% at fault and totaled out my pickup truck that I used exclusively for my farming business. It took several months to settle with the insurance company. The actual crash took place in 2018 but the check from the insurance and settlement took place in 2019.

Which year do I apply the recapture on the pickup?

Thanks for the help!

 

[LdiJ]

What is the name of your state? Minnesota

Hello--

I was involved in an auto accident which the other party was 100% at fault and totaled out my pickup truck that I used exclusively for my farming business. It took several months to settle with the insurance company. The actual crash took place in 2018 but the check from the insurance and settlement took place in 2019.

Which year do I apply the recapture on the pickup?

Thanks for the help!

You would stop depreciating it as of the date it was totaled, but if you are a cash based taxpayer, you would not recapture depreciation until 2019 because you did not "sell" the truck until then.

 

[beeefey]

Thank you! Yes I am cash based and I took in on section 179 originally.

 

[LdiJ]

Thank you! Yes I am cash based and I took in on section 179 originally.

If you expensed it on Section 179 then there would be no recapture. You never depreciated it.