Reply to What do all these people driving new Range Rovers do for a living?

Forum Index » Money and Finances

Reply to "What do all these people driving new Range Rovers do for a living?"

Subject:

Emoticons





More smilies

Text Color: Font: Close Marks

[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]Have a small business on the side, lease and deduct. [/quote]

Yeah, that makes is free!  You have no idea what you are talking about.  [/quote]

Um, that's how it works. Offsets the cost of the car against the small business's income. Thanks for the MB, Uncle Sam![/quote]

OK, I own a business and have a leased car.  This is how it works:

Car Lease - 12K/year
Gas, Insurance, Maintenance - about 4K/year.

I use the car for work about 50% of the time - the rest is personal.

Uncle Sam says that 50% of the car's cost is income since it's personal. So that's 8K in income to credited to me that I need to pay about $3200 in taxes on.

So my business pays 16K for the car and its expenses, and I get to pay about $3200 in taxes on the car's value to me personally of 8K.

I can only do this because I drive a lot for work - out of town trips, etc.  If you use it for commuting, that is not considered a business expense.  Your 20 mile trip each way to the office is not a deductible business expense.  If you leased a car and only drove it to commute, you'd be paying taxes on close to 100% of the car's value.[/quote]

Options

	Disable HTML in this message
	Disable BB Code in this message
	Disable smilies in this message

Review message

Search Recent Topics Hottest Topics