I bought a car a couple months ago, but I've decided I want to go for another car. My friend will take it off my hands for a couple hundred less than what I bought it for. For this sale, will I have to claim income tax? Other than changing the title and accepting my friend's money, are there any other considerations I should be aware of?
2007-03-29 12:02:26 · 3 answers · asked by Ed 2 in Cars & Transportation ➔ Buying & Selling
No you are not even making any money on it and you don't have to pay income tax on cars.
2007-03-29 12:05:49 · answer #1 · answered by mom of twins 6 · 0⤊ 0⤋
You don't claim your car sale on your income tax, why would you? The buyer will be paying sales tax, when he titles/registers the car, if you live in a state where sales tax is collected.
2007-03-29 19:07:12 · answer #2 · answered by fisherwoman 6 · 0⤊ 0⤋
No loss deductible, no tax consquences if a profit is made.
Only if one sells several cars a year. One becomes a retail dealer. The number may vary from state to state.
2007-03-29 19:11:34 · answer #3 · answered by ed 7 · 0⤊ 0⤋