Question

I’m receiving a full refund for the purchase of a car I made in 2013. Will I have to pay taxes on the refund?

Forum|Forum|6 years ago
June 21, 2019
1 reply
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TurboTax Deluxe Online

Employee

Have you ever used the car for business (e.g., took deductions based upon mileage, depreciation, etc.)?

If not, the car is nothing more than a capital asset held for personal use in your hands. As such, your basis is whatever you paid for the car. Consequently, unless you receive more than what you paid, you have no gain and, thus, no tax liability on that transaction.