I have an S Corporation with a vehicle that was placed in service 5 years ago. It was converted to personal use in early 2014.

But it was only 50% business business over that 5 year period.

Let's say it was purchased for $40,000, and 179 of $20,000 was taken.

Now, at conversion, the FMV is $20,000.

My software is showing $20,000 of basis ($40K cost, less $20K 179), despite the 50% business use clearly reported on the return.

I think my basis should be $0 (cost of 50% of $40K = $20K, less $20Kk 179).

And my proceeds should be 50% of the $20K total, and thus I should have a $10K gain, subject to 179 recapture.

I'll take the steps to manipulate the return to return that result - $10K of gain, but I wanted to make sure I'm not missing something - do I somehow get the benefit of the personal basis of the vehicle in determining gain? (No way that's right). Thoughts?