It is a common misconception that vehicles that are no longer owned by the taxpayer, need to file a 2290. It is thought as sort of a way to let the IRS know that they have parted ways with the vehicle. However, since 2290 tax is the heavy vehicle use tax, if you are not using the vehicle, especially because you have sold it or because it was destroyed, you are not required to file a 2290.
How will I let the IRS know that I no longer own the vehicle?
If the IRS were to ask why you did not or have not filed for a particular vehicle all you need to do to let them know the vehicle was sold, traded, or destroyed. In order to prove any of those claims you need to provide a bill of sale and/or receipts from the junk yard.
Exceptions
Sold or Destroyed Suspended (aka low mileage) Vehicles
Vehicles that have been sold or destroyed that were filed as tax exempt need to be reported on your next tax form.
If you need any further clarification, give us a call!
Help Line: (888) 802-4299 – Phone: (909) 596-0050
Written by Yesenia Carrillo