Topic
l had my company vehichle repossessed, and they say l owe them 29,000. can this be used as a tax advantage for me?
can a repossession be a write off on this years taxes
No tax advantage. Quite the opposite. If you do not pay the debt they will cancel the debt and send you a 1099C. Cancellation of debt. Since you had use of the car and did not pay for it the money becomes taxable income. It is reported to the IRS. You will add the 29000 to your wages for total income. If you can prove insolvency it may eliminate some or all of the money. That is form 982.
can a repossession be a write off on this years taxes
Oh, this will affect ur taxes, but very probably not in the way that u r hoping!
On a business return, a repo is treated as any other sale of an asset. The selling price is the outstanding balance of the note. If the book (depreciated) value of the asset is less than that, u have a taxable capital GAIN. If it is more, u have a capital loss. If any portion of the note is forgiven, that amount is treated as taxable income.
Therefore if you're like most businesses & took accelerated depreciation in the early years of the asset life, u will most likely have a taxable gain once the dust fully settles.