If a used $15,000 automobile used 100% for business in the first year (2011)fails the 50% business usage test in the second year,no cost recovery will be recaptured.

Question

Quizplus · Accepted Answer

If the automobile fails the 50% business usage test in the second year, cost recovery (depreciation) recapture will occur. This means that the business will have to pay back a portion of the depreciation claimed in the first year.

If a Used $15,000 Automobile Used 100% for Business in the First