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Category: Inspirational Current Grade: A Total Views: 1751 Member Comments: 5 |
Posted on: 03/14/2007 Posted by: crystalwillett Blog Points: 5079 View all blogs >> |
Does anyone know something about buying a new/used truck for a company vehicle? I read somewhere that it HAD to be one of those big 'ton' trucks or it wouldn't be counted as a tax write off for your company. Do you know if it can be any sized pick up truck, used? new? Any thoughts on this? I have a friend who is about to purchase a new vehicle for his business and wants to make sure what he gets is for business and tax write off.
My other question .. while I'm here....
I was showing the house to a woman yesterday who wants to lease option. She made it clear that she wanted the interest write off on her taxes. I've never done that on a lease option, even the ones I buy as lease options. I didn't even know that was possible, unless I was buying an owner financing. Is it possible? Have I been missing out on all the interest earned from the houses I've been lease optioning from owners?
To purchase a vehicle for your company it has to meet tonnage requirements and be new. You might as well just lease a nice vehicle and enjoy the full write-off of the lease and the milage write-off(keep a milage log).
You can not do a lease-option and get the tax break on the interest as the leasee. You can techinically deed over your equitable interest in the property and not trigger the due-on-sale clause in your mortgage. BUT, you would then lose out on the tax breaks and if she didn't pay would have to foreclose on her instead of merely evict her. It's easier just to lease-option:)
You have NOT been missing out! Its a lease with an option to buy. Not a sale with a loan that has interest. In a Lease option She is making lease Payments - not mortgage payments. Therefore there is no interest write off.
If she wants the interest write off - tell her to hurry up and finance it!
Sean
Hello,
KCRealEstate info is correct.
But do you know that when you lease a vehicle for your company it is 100% right off. So for example if car payments are $450.00 and you pay the lease for a whole year that will be $5400.00 a year. Then you can take that and get 100% back so then you take that $5400.00 and use it next year. Now you have a new car every three to four years. This was one of the information I learned from my Asset Protection Class. This information came from three Attorneys’ that are partners and said that is how we are able to drive the nice cars… Cool info….
Inregards to the Lease / Option, why would you want her to benefit with the interest. I would not do that.
Maria
From what I understand (I'm not a professional, but talked to a CPA recently), it can be any vehicle as long as it is necessary to the business. If you have to drive around for your business then any car would be necessary. Be aware though that you will have to keep track of any miles that were for personal use. That will affect the company's deduction.
The CPA also brought up another good point though. If you use a personal car for your business, then you can get a reimbursement from the company for (check with IRS for accurate number) $.54 per mile driven!!! That's a good rate. So if you drive 1,000 miles for the company, the company can reimburse you $540 tax free to you and it counts as a business expense to the company so that is not taxed either.