I traded in my old car to purchase a new car (as in, latest year, never been owned before) in the middle of last year. I'm filling out my taxes and TurboTax is asking me to fill out the "FMV of like-kind property you received". I assume that FMV stands for "Fair Market Value"

According to this site:

The FMV of the like-kind property received is the price or value of the new vehicle you purchased, before any trade-in allowance.

In looking through my records, I see two numbers for my new car: the MSRP price and the lesser "Price Before Savings" that the dealership was offering. The difference is about two thousand dollars.

Which price is the IRS looking for?

As noted in the comments, I had made a mistake in TurboTax, so I didn't actually need to fill this out. Still, I figure I'll keep this question open for the benefit of others who may be asking it.

  • 2
    You use this vehicle 100% for business use? – Hart CO Feb 28 '18 at 1:55
  • @HartCO No, I use it 0% for business use. What leads you think that I'm using it for business use? Did I fill out something wrong? – Thunderforge Feb 28 '18 at 2:23
  • 2
    Why are you even entering data about personal cars into TurboTax? About the only reason I can think of is the sales tax deduction which you can use in place of the state income tax deduction if you live in a no-income tax state, and there you are allowed to add on sales tax paid on a car purchase to the sales tax you can deduct using the IRS tables. And for this, you don't need FMV etc, just the certification from the dealer (or the bill of sale which will list the sales tax paid). – Dilip Sarwate Feb 28 '18 at 2:57
  • Possibly related: irs.gov/pub/irs-pdf/i8824.pdf I do not believe that a trade-in and purchase of a newer car by a private individual is what is meant here. – chili555 Feb 28 '18 at 3:07
  • Yeah sounds like you're down the wrong path, if it's not business use then it's irrelevant. – Hart CO Feb 28 '18 at 3:11

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