Suggest videos to watch next: "How to Buy a Car in Your Business Name [Step-by-Step] - ruclips.net/video/gJn2king8P8/видео.html "How to Write Off Your Dream Car: ruclips.net/video/RlqTFM5ab5Y/видео.html
Hi, I already bought a pick up for my business, but I bought using my personal credit and I'm looking now a way to transfer over my business. Could you share some advices or steps to properly transfer the vehicle to mu business in order to get all the tax deductions? Thank you. I really appreciate all your knowledge shared in your videos.
Hi there, CPA here. The title of the video is definitely misleading. Yes you can use Section 179 to accelerate depreciation to reduce your tax liability. This may reduce your tax bill, but I assure you, this will not make your car "FREE" as the title states. There are also other factors you need to consider. 1) Do you drive a lot of miles for work? - If you do, then you won't want to use Section 179 in the first place, because once you use the "Actual Expenses" method you can't use the "Mileage Rate Method". However, you can always start off using the Mileage Rate Method and then switch over to the Actual Expenses Method. 2) Do you expect your income to go up in future years? - If you do, then you will want to spread out the depreciation expense over time instead of taking it all up front. You may see yourself saving $$$ right now and get really excited, but in reality you may want to consider spreading the expense out over time to help keep your tax bills lower over the next few years. Also, you will want to look at which politician is in office and how their proposed future tax bills may increase or decrease your current tax rate and what your future tax rate might look like and choose when the best time to take the deduction would be. You will never get a "FREE" car due to filing your taxes a certain way, not legally at least. There are tax advantages though of owning and using your car for business that you don't want to miss out on.
THANK YOU for mentioning the recapture! So many other youtubers talk about how you can "get a car for free" not advising folks the difference between an actual refund vs a deduction and mentioning the recapture. Dont mess w the IRS, they always get what they come for LOL
He forgot to add Audi Etron. It is all electric with a range of 255 miles and GVWR of 7,066 lbs. In addition to 100 percent deduction, it is entitled to $7,500 non refundable cash rebate for a EV as well as electric charger installation cost to be filed on IRS form 8911 or 3800. The SUV with a base MSRP of 69,000. Lot of luxuries, comfortable ride for a base model.
As someone studying accounting with a focus on tax, be extremely careful about this. I know he goes in to a few risks, but there are so many. One huge part of my major is just getting random code sections and finding applicable case law to determine how to use the code or not, along with case studies for the same thing. I had to do a paper on 179 and there is so much case law on people who think they are slick and do this, but then the IRS figures out what they are doing, and they not only get hit with the extra tax, but all sorts of penalties. There are also risks outside the IRS, with how your income is reported to creditors and such, so just talk with a tax/financial advisor if you want to do this, and actually plan it.
A most successful business always comes with risks as well as business taxes. The risk is what gets you the money. You're right being knowledgeable is an asset.
As a realtor in Atlanta, be careful deducting too much. If you deduct the vehicle for the max this would help in decreasing your income for tax purposes but it can hurt you if planning on buying a home. lenders may not be willing to approve the mortgage due to income on taxes being insufficient. They will have to use bank statements, assets and reserves.
Where I live, mortgaging is prohibited. Land of Lincoln. Amish Country. No debt, no tax...no s.s.i. No mortgaging, gambling, booze or smoking. No Solicitors... No Las Vegas.
At 34 years old I finally feel ready to settle down long enough to buy a house. Unfortunately due to previous horrible stupid life decisions, I'm forced to start with a zero balance in my savings account. On the bright side, the huge amount of debt - consequence of those bad decisions will be payed off next month! 🥳 It's never too late to start saving like there's no tomorrow, and I'm really REALLY excited and motivated. Oh and Marvin, fyi my emergency fund is also a done deal! by CREDIT PATCHUP lol, i didn't made it myself
I can tell you that yes the pandemic definitely caused people to realize their worth, as for myself I worked at a bakery where the wages paid were $8-$12. I refused to go back to that and now I’ve started my own business. I absolutely never want to work for anyone else as long as I live and still in close contact with Credit Patchup
People it is reducing your tax liability by example $25,000.00 that means if you are taxed for $100,000 (40% = $40,000) now it will be $75,000 (40% = $30,000) you are being taxed on so if you look what 100k is taxed then 75k is taxed and subtracted the two($10,000), this is the actually dollar figure (not $25,000 back ) so a the new suv example $925 was monthly payment actual would be about $508 if you do the 24 month with the $10,000. It is still worth it, but I like real numbers. Its the little details that you should explain. Unless I am wrong.
Thank you for explaining this… thought I should buy a truck to save me some taxes but after I entered in the purchase price of the vehicle I saw it only saves me 9k…
@@Behindyamom Yes, they want you to stimulate the economy, they have an ulterior motive. When you buy shit the dealer pays tax, you buy gas, service, employ more people, they pay tax etc. You get some savings but it is far from a free car. They figure in most cases an expensive pickup is used in construction...
This is for commercial vehicles, that is why they use GVWR. There is a stipulation that if the vehicle doesn't have a commercial plate on it and you get audited you can get into trouble and owe more with these crappy hyper depreciating cars and their gas mileage. This is intended for businesses that have to buy fleet vehicles like landscapers and construction and stuff like that. Good luck to everybody in 2021 and 2022 tax season, we are going to need it.
For a couple of years now, I've been wondering why the local used luxury car dealer that we got my wife's car from constantly has G-Wagons for sale. At any given time, they have at least 10 of them and they seem to get snapped up fairly quickly. Now I totally know why. Once you learn about stuff like this, you can't unsee it. Now when I drive around, every G-Wagon or Range Rover that I see is probably someone's tax write-off, as opposed to merely being someone's flex.
Hey, accounting student here. Why are we writing off the entire cost of the vehicle with no allowance for residual value? Like, if that Tesla Model X were to sell for $80k, but you could resell it or trade it in after five years for $20k, then even Sec 179 would only let you write off the $60k difference, I thought.
Unfortunately when you choose this method once you use it you lose it ! In other words the second year you will have no auto expense except actual where as if you use mileage this usually will prove more beneficial in the long run . There is no limit in the mileage amount you use ( tech there is but I have never seen the IRS ever enforce that ) . Taking accelerated depreciation on auto usually only makes sense if you r involved in a business that makes a lot of vehicle purchases year after year . ANC remember you could only pick one , you can’t use 179 one year then do mileage. I don’t see any advantage for most of the common business out there where it would benefit you again only that first year . But if you use mileage at .56 (it will go up again ) it’s a no brainer which would benefit you in the long term vs that first year hit . Like I say to all my clients it’s super rare to buy anything for the sole sake of saving taxes . The only thing you should buy to save you tax is anything that can generate income( ie any capital expenditures that helps you grow and generate $$ ) . A Lexus rarely falls into that category. Remember you still have to pay for that whip . And again taking 179 will save you $$ in the year of purchase but you will lose money vs mileage in the long term .
Basically like he did mention, its like getting a discount on the car? What ever your tax rate it for your business thats the discount you get on the car
A $50,000 Tax Deduction Does NOT Save you $50,000 (ie free car) . If you are in a 24% tax bracket.. it saves you 24%.. not 100% If you buy a Range Rover.. you will get extra write offs of maintenance as they are not reliable..
So first year itself we can write off 100% using bonus depreciation and 179, after that can we take any other deductions in the following years for the same car? (For eg: year 2-5) or it’s all over after we write off 100% in the first year. Also how the recapture works if the vehicle involved in an accident and totaled (maybe in year 3) after we write off everything in first year. Thanks.
Hey, how about if you talk a little bit about real family workers, not so much about celebrities who don't even need write off s. Like people needed to buy a working van, is that possible?
Not sure why you're even bringing IRC 179 into this, which limits the deduction for SUVs to $25k. You should explain that, for some tax years, IRC 168(k) allows for 100% depreciation in year one, and that IRC 280F does not limit that amount if the vehicle "is rated at 6,000 pounds unloaded gross vehicle weight" or greater. More applicable, trucks are exempt from all of these limitations, so that should be your recommendation/focus. If you're going to give tax advice, it's imperative to be precise and accurate.
I like the idea at the beginning but I think he is going too far...Armour vehicle?? what nest G5??? If a person is making that kind of money they will not be here on RUclips or his channel. They will have someone do it for them. Just a HUMBLE suggestion, good idea BUT let's NOT preach GETTORICH schemes, etc Please. IRS is NOT a FOOL. Remember.
Most of these cars do not qualify as a full write off you have to go into deep details on section 179 mostly cargo vans and pick up trucks qualify I wouldn't buy q luxury car for a business expecting write off the whole thing the first year that's a bad idea
Nothing he says is technically incorrect, BUT, there is no way to get a "FREE CAR" by using Section 179 depreciation expense. What he doesn't mention is the recapture of all 179 depreciation when you sell the car. You will pay tax (at your marginal tax rate) on the entire sales price of the car. There are "NO FREE LUNCHES' from the IRS. I am a CPA and have been doing taxes for over 50 years. Beware of free advice----It is worth what you pay for it!
I guess that putts the end to my plan. So you're saying that if you sell the car the following year, you'll owe back some or most of that 179 depreciation expense?
But you need to OWE this much in taxes to begin with in order to benefit from this, correct? So for example, If my business only owes $7,000 in taxes at the end of the year, I'm not going to really benefit from buying a $79,000 car?
:lol: no. It may wipe out your tax liability (no credits) but if you have no profit after a few years and keep taking deductions that is a guaranteed audit, and they can call your business a hobby, then they can retroactively remove the deduction and make you pay tax.
thanks for the video very helpful, have a question if I have 2 vehicles and use both for business, can I use different methods for deduction 1st one with standard milage and the second one with actual expenses with depreciation and using the 179 section. thanks
Also, are pickup trucks included in the exemption? Most diesel engine trucks are 6000+ I believe the Cayenne in Porsche Cayenne is pronounced like the hot pepper...not how you said it. Thanks,
Awesome video Sean. What if my wife business does not make much but I have tax liability from my full time job? We file joint. Can we take advantage of this 179? Thanks again!
Hey, good question. The Section 179 deduction is limited to the net income of the business but bonus depreciation isn't. Look into bonus depreciation for vehicles over 6,000 gvwr. Hope that helps.
I have a tricky question, I have a home office that I write off, it’s a different room and I separate the cost of house by room, so when I use this 179 section when I leave to go to a work site or site of employment(company employed my company) driving from my home office to the work site is considered business mileage, in this case it would be completely tax deductible correct?
Not tricky at all, yes that counts! "Publication 587, Business Use of Your Home" Essentially you calculate the percentage utilized for business purposes. Can google this to pull up exactly how to calculate but yes that counts. :)
Started before you need to spend around two hours atleast at a home office they said. Other thing, if you make your vehicle an advertisement for your business I think it’s a loophole that makes all trips just about “business” as your promoting. Don’t quote me.
Can you please repeat GVW vs GVWR because there’s lots of videos using the two interchangeably and it’s confusing. There’s a difference between the two
Same thing, the second one just has a redundant “rating” at the end, they both mean (the weight of the car, plus the maximum weight of all people and cargo)
you said it isn't a good idea to buy and a car via 179 and then sell it the next year and buy another the following year as so on every year or you might get in trouble. Why is that?
Thanks for a great video! How much of a business credit limit should we have to be able to go into the dealership and drive out with that Range Rover? Its not as easy as it sounds for a brand new business, is it?
Yes this is the same question I have been asking and looking up online but there is no answer anywhere. In this reason, I believe the only thing I've found is that your business income has to meet the requirements for the banks to believe you can pay it off, therefore lets say you will need to prove you are making if not equal a greater annual business income to qualify for any car write off.
This is utter BS. There is no way you can get a car for free. First of all you have to make $100k to write off $100k. Second the $100k are only taxed like 12%. So you will save $12k but you still pay $88k for the car.
Thanks for great video, I am pretty sure there are some more vehicles qualify for this deduction, can anybody tell me where and how can I find them? Above 6000 GVWR, I am looking to buy 2022 Sienna, Odyssey or Honda Pilot, it only tell me curb weight. And my CPA guy told me that whatever weight that states on the title counts. I looked up title on my 2018 Odyssey it states 4,500 pound ( which is curb weight I assumed). Again, when I do google search it appears that Odyssey and Pilot both qualify, confuse me a lot. Which one is it? Curb weight or GVWR? Or title stated weight? Running out of time, can someone help me, really appreciate. Thank you
So if I buy a new G-Wagon (average price is $150,000) and I don’t want to take accelerated deprecation within the first year. How many years can I depreciate the vehicle and how much can I depreciate each year!? Thanks in advance! Love the video
Quick question is the gvwr or the auctual weight im Trying to Purchase the gle63 coupe . I tried to look it up n the irs website but luck could You point me To The right direction thanks
Hi I just talk to hr block, the lady confused me... If I buy a car over 6,000 pounds I'm a sole proprietorship, say I paid $80k, & don't owe the irs and I use 179 accelerated depreciation within the first year, when I file my taxes will I get the full 80k back returned into my account?
Hey this video was a great help!! quick question though. When you say, for example, the Tesla has an estimated tax deduction of $79,990. Would that be a yearly reoccurring deduction, or would the tax deduction only be applicable once the vehicle is done being used?
He states in the beginning, instead of having the expense be split into 5 or so years, you combine it into the first year of purchase as why its called accelerated depreciation.
My small biz llc needs a new car to deliver and pickup customer equipment. So I can basically use this to buy a car that could help my biz? Plus can I record mileage on it aswell? I'm beating my original truck with pickups/deliveries and miles. My llc is 1 hour away from home!
Makes absolutely no sense to me, what does it even mean to write it off, so you pay for it all then the government gives you the money back because you own a business ??
I have a model 3 & Y. I plan on having the model s & x added to my fleet but definitely want to get more info on how to get the model x tax deduction since its gvwr is >6000lbs right?
Can I use the depreciation tax of a 6k pound vehicle as a doordash driver in California? I'd buy the tesla X model if I could. Please share your thoughts thank you!
Honestly I think you could, especially since you're an independent contractor technically. Maybe creating an LLC for basically driving (maybe walk dogs).
@@FirefighterMarcel95 Thanks for responding! Good to know bc I’ve been wanting one for awhile and thought it didn’t qualify. I looked of the weight and it was less than 6000 pounds online.
Suggest videos to watch next:
"How to Buy a Car in Your Business Name [Step-by-Step] - ruclips.net/video/gJn2king8P8/видео.html
"How to Write Off Your Dream Car: ruclips.net/video/RlqTFM5ab5Y/видео.html
Hi, I already bought a pick up for my business, but I bought using my personal credit and I'm looking now a way to transfer over my business. Could you share some advices or steps to properly transfer the vehicle to mu business in order to get all the tax deductions? Thank you. I really appreciate all your knowledge shared in your videos.
But do you need to have a business at all to get it?
Hi there, CPA here. The title of the video is definitely misleading. Yes you can use Section 179 to accelerate depreciation to reduce your tax liability. This may reduce your tax bill, but I assure you, this will not make your car "FREE" as the title states. There are also other factors you need to consider.
1) Do you drive a lot of miles for work? - If you do, then you won't want to use Section 179 in the first place, because once you use the "Actual Expenses" method you can't use the "Mileage Rate Method". However, you can always start off using the Mileage Rate Method and then switch over to the Actual Expenses Method.
2) Do you expect your income to go up in future years? - If you do, then you will want to spread out the depreciation expense over time instead of taking it all up front. You may see yourself saving $$$ right now and get really excited, but in reality you may want to consider spreading the expense out over time to help keep your tax bills lower over the next few years. Also, you will want to look at which politician is in office and how their proposed future tax bills may increase or decrease your current tax rate and what your future tax rate might look like and choose when the best time to take the deduction would be.
You will never get a "FREE" car due to filing your taxes a certain way, not legally at least. There are tax advantages though of owning and using your car for business that you don't want to miss out on.
THANK YOU for mentioning the recapture! So many other youtubers talk about how you can "get a car for free" not advising folks the difference between an actual refund vs a deduction and mentioning the recapture. Dont mess w the IRS, they always get what they come for LOL
Right! Thanks for watching.
@@LYFEAccounting how would it work if the vehicle was not a 6k pound car? I have 2022 kia niro ev suv that I use for uber.
He forgot to add Audi Etron. It is all electric with a range of 255 miles and GVWR of 7,066 lbs. In addition to 100 percent deduction, it is entitled to $7,500 non refundable cash rebate for a EV as well as electric charger installation cost to be filed on IRS form 8911 or 3800. The SUV with a base MSRP of 69,000. Lot of luxuries, comfortable ride for a base model.
As someone studying accounting with a focus on tax, be extremely careful about this. I know he goes in to a few risks, but there are so many. One huge part of my major is just getting random code sections and finding applicable case law to determine how to use the code or not, along with case studies for the same thing. I had to do a paper on 179 and there is so much case law on people who think they are slick and do this, but then the IRS figures out what they are doing, and they not only get hit with the extra tax, but all sorts of penalties. There are also risks outside the IRS, with how your income is reported to creditors and such, so just talk with a tax/financial advisor if you want to do this, and actually plan it.
you are absolutely right about this
the risk to creditors isnt really there as they tend to go by gross income not net
A most successful business always comes with risks as well as business taxes. The risk is what gets you the money. You're right being knowledgeable is an asset.
Do you have any real world experience?
@@JJ-mh3hb I do. He is right. Be careful. Know the limitations.
As a realtor in Atlanta, be careful deducting too much. If you deduct the vehicle for the max this would help in decreasing your income for tax purposes but it can hurt you if planning on buying a home. lenders may not be willing to approve the mortgage due to income on taxes being insufficient. They will have to use bank statements, assets and reserves.
Where I live, mortgaging is prohibited.
Land of Lincoln. Amish Country.
No debt, no tax...no s.s.i.
No mortgaging, gambling, booze or smoking.
No Solicitors...
No Las Vegas.
At 34 years old I finally feel ready to settle down long enough to buy a house. Unfortunately due to previous horrible stupid life decisions, I'm forced to start with a zero balance in my savings account. On the bright side, the huge amount of debt - consequence of those bad decisions will be payed off next month! 🥳 It's never too late to start saving like there's no tomorrow, and I'm really REALLY excited and motivated. Oh and Marvin, fyi my emergency fund is also a done deal! by CREDIT PATCHUP lol, i didn't made it myself
I can tell you that yes the pandemic definitely caused people to realize their worth, as for myself I worked at a bakery where the wages paid were $8-$12. I refused to go back to that and now I’ve started my own business. I absolutely never want to work for anyone else as long as I live and still in close contact with Credit Patchup
Thank you
How about if l have military deduction thru the VA
People it is reducing your tax liability by example $25,000.00 that means if you are taxed for $100,000 (40% = $40,000) now it will be $75,000 (40% = $30,000) you are being taxed on so if you look what 100k is taxed then 75k is taxed and subtracted the two($10,000), this is the actually dollar figure (not $25,000 back ) so a the new suv example $925 was monthly payment actual would be about $508 if you do the 24 month with the $10,000. It is still worth it, but I like real numbers. Its the little details that you should explain. Unless I am wrong.
Thank you for explaining this… thought I should buy a truck to save me some taxes but after I entered in the purchase price of the vehicle I saw it only saves me 9k…
@@Behindyamom Yes, they want you to stimulate the economy, they have an ulterior motive. When you buy shit the dealer pays tax, you buy gas, service, employ more people, they pay tax etc. You get some savings but it is far from a free car. They figure in most cases an expensive pickup is used in construction...
Thanks to you i just wrote off a new bullet proof G wagon for my dog poop cleaning business. Thanks man hopefully i don't get audited
This is for commercial vehicles, that is why they use GVWR. There is a stipulation that if the vehicle doesn't have a commercial plate on it and you get audited you can get into trouble and owe more with these crappy hyper depreciating cars and their gas mileage. This is intended for businesses that have to buy fleet vehicles like landscapers and construction and stuff like that. Good luck to everybody in 2021 and 2022 tax season, we are going to need it.
Thank you! That only thing is you have to pay a big chunk of monthly payment for these vehicles
For a couple of years now, I've been wondering why the local used luxury car dealer that we got my wife's car from constantly has G-Wagons for sale. At any given time, they have at least 10 of them and they seem to get snapped up fairly quickly. Now I totally know why.
Once you learn about stuff like this, you can't unsee it. Now when I drive around, every G-Wagon or Range Rover that I see is probably someone's tax write-off, as opposed to merely being someone's flex.
Thank you for simplifying the lingo and explaining it so people like us can understand.
The surburban is not competitor of the Yukon. The Yukon is just a step up to the chevy. And the escalade is the top of the tier between the three
Hey, accounting student here. Why are we writing off the entire cost of the vehicle with no allowance for residual value? Like, if that Tesla Model X were to sell for $80k, but you could resell it or trade it in after five years for $20k, then even Sec 179 would only let you write off the $60k difference, I thought.
Unfortunately when you choose this method once you use it you lose it ! In other words the second year you will have no auto expense except actual where as if you use mileage this usually will prove more beneficial in the long run . There is no limit in the mileage amount you use ( tech there is but I have never seen the IRS ever enforce that ) . Taking accelerated depreciation on auto usually only makes sense if you r involved in a business that makes a lot of vehicle purchases year after year . ANC remember you could only pick one , you can’t use 179 one year then do mileage. I don’t see any advantage for most of the common business out there where it would benefit you again only that first year . But if you use mileage at .56 (it will go up again ) it’s a no brainer which would benefit you in the long term vs that first year hit . Like I say to all my clients it’s super rare to buy anything for the sole sake of saving taxes . The only thing you should buy to save you tax is anything that can generate income( ie any capital expenditures that helps you grow and generate $$ ) . A Lexus rarely falls into that category. Remember you still have to pay for that whip . And again taking 179 will save you $$ in the year of purchase but you will lose money vs mileage in the long term .
Basically like he did mention, its like getting a discount on the car?
What ever your tax rate it for your business thats the discount you get on the car
Amazing knowledge my brother! Getting a food truck trailer in 2 months and need to deduct a truck to tow that bad boy 💪🏾🤲🏾🍛
Oh this is absolutely perfect for you!
Good luck man, I have the same plan in about 8 years when I retire from the military!
@@brianlevel7669 wish you the very best my brother! Let's turn our dreams into reality, God willing.
You said Grant Cardone is in a g-wagen, but in the picture you showed a Brabus. The price difference is incredible lol
Come on bro how you not gone have the hottest SUV in the game right now on the list. Cadillac Escalade should have been first.
😂😂😂 that qualifies!
I was thinking Tahoe but Cadillac? even better!
you still have to make the monthly payments lol
A $50,000 Tax Deduction Does NOT Save you $50,000 (ie free car) . If you are in a 24% tax bracket.. it saves you 24%.. not 100% If you buy a Range Rover.. you will get extra
write offs of maintenance as they are not reliable..
This is true UNLESS your tax bracket is 0 😝
So first year itself we can write off 100% using bonus depreciation and 179, after that can we take any other deductions in the following years for the same car? (For eg: year 2-5) or it’s all over after we write off 100% in the first year.
Also how the recapture works if the vehicle involved in an accident and totaled (maybe in year 3) after we write off everything in first year. Thanks.
Hey, how about if you talk a little bit about real family workers, not so much about celebrities who don't even need write off s. Like people needed to buy a working van, is that possible?
Awesome video fr the work on this channel is unbelievable
great video and good video editing! Thanks for your work on this!
Not sure why you're even bringing IRC 179 into this, which limits the deduction for SUVs to $25k. You should explain that, for some tax years, IRC 168(k) allows for 100% depreciation in year one, and that IRC 280F does not limit that amount if the vehicle "is rated at 6,000 pounds unloaded gross vehicle weight" or greater. More applicable, trucks are exempt from all of these limitations, so that should be your recommendation/focus. If you're going to give tax advice, it's imperative to be precise and accurate.
What he said. I wish the IRS would crack down on all the tax code misinformation on RUclips.
They are definitely problematic. Maybe the licensing boards will pick up on the bad stuff for those that state they are a CPA.
THIS ASSUMES ITS USED 100 % FOR BUSINESS PURPOSES ( NO PERSONAL USAGE) FOR FIVE YEARS. IF YOU DONT USE IT THAT WAY...RECAPTURE.
You are absolutely right
@@LYFEAccounting and you need to maintain records to prove business usage
Your not getting it for "free" you just owe %15 less self employment tax on the amount of the car. Still taking a hit of % 85 cost.
seriously where are these peoples heads
@@TrayJayRecords the dude think theres a Porsche Canine. lol
Even a 100% tax deduction doesn’t make the vehicle free. That would be a tax credit, which isn’t available for 100% of the cost of the vehicle.
I like the idea at the beginning but I think he is going too far...Armour vehicle?? what nest G5??? If a person is making that kind of money they will not be here on RUclips or his channel. They will have someone do it for them.
Just a HUMBLE suggestion, good idea BUT let's NOT preach GETTORICH schemes, etc Please. IRS is NOT a FOOL. Remember.
THANKS BRO LAYIN IT OUT FOR ME N US 💯
If I purchased my vehicle in December 2021, will I be eligible for a tax write off in January 2022?
great question
7:10 love the way you vibe up with $250,000 😂
CAYENNE/CANINE. Appreciated subtitles.
Most of these cars do not qualify as a full write off you have to go into deep details on section 179 mostly cargo vans and pick up trucks qualify I wouldn't buy q luxury car for a business expecting write off the whole thing the first year that's a bad idea
Bruh, YOU FORGOT THE CULLINAN and the X7!!! haha. Great vid. Thanks.
Good call! 😂💯
Man, I really don’t want to get hit by that Tesla. Gonna look three times now before crossing the street.Lol
Just because you have a business and you make little to no money per year, are you still viable to use this accelerated depreciation?
yea, but why would you? you'd likely fail in business trying to buy more than you should.
What happens if the vehicle(s) receiving the deduction are traded in as opposed to being sold?
treated the same'
Nothing he says is technically incorrect, BUT, there is no way to get a "FREE CAR" by using Section 179 depreciation expense. What he doesn't mention is the recapture of all 179 depreciation when you sell the car. You will pay tax (at your marginal tax rate) on the entire sales price of the car. There are "NO FREE LUNCHES' from the IRS. I am a CPA and have been doing taxes for over 50 years. Beware of free advice----It is worth what you pay for it!
This is part 2 video of how to write off your dream car. In that video, I breakdown depreciation recapture as well 😉
I guess that putts the end to my plan. So you're saying that if you sell the car the following year, you'll owe back some or most of that 179 depreciation expense?
5:45 Did he just say Canine?
But you need to OWE this much in taxes to begin with in order to benefit from this, correct? So for example, If my business only owes $7,000 in taxes at the end of the year, I'm not going to really benefit from buying a $79,000 car?
:lol: no. It may wipe out your tax liability (no credits) but if you have no profit after a few years and keep taking deductions that is a guaranteed audit, and they can call your business a hobby, then they can retroactively remove the deduction and make you pay tax.
Woo-hoo! My Maserati Levante qualifies, barely, but still works :)
Hi! What about a Lamborghini Urus? Also, do I have to keep the vehicle for five years, or can I sell it off year 2 and buy another?
Great video! What if you don’t make more than the cost of the vehicle for the year?
i believe that’s irrelevant to this program.
I believe that’s called a Loss when you spend more then you net? I’m also looking for someone to go into how losses work
Does the car need to be brand new?
Must be car be paid for in full or will a financed vehicle qualify for 100% write-off/deduction
So awesome, great job 😊
💯💯
thanks for the video very helpful, have a question if I have 2 vehicles and use both for business, can I use different methods for deduction 1st one with standard milage and the second one with actual expenses with depreciation and using the 179 section. thanks
After 5 years, when sell the car, do I need to report it as income? Is the five years the cut off period?
Also, are pickup trucks included in the exemption? Most diesel engine trucks are 6000+
I believe the Cayenne in Porsche Cayenne is pronounced like the hot pepper...not how you said it.
Thanks,
Pretty sure those are covered
6000 pounds sounds like a lotta pounds lmaoooo facts
Awesome video Sean. What if my wife business does not make much but I have tax liability from my full time job? We file joint. Can we take advantage of this 179? Thanks again!
Hey, good question. The Section 179 deduction is limited to the net income of the business but bonus depreciation isn't. Look into bonus depreciation for vehicles over 6,000 gvwr. Hope that helps.
Every car is eligible for Section 179, not just 6000LBS + vehicles. It needs to meet your business and job requirements.
He's specifically talking about accelerated depreciation
Why only SUVs? Only one I would get of those choices is the Porsche. Doesn't the Audi RS6 Avant count?
Great info boss. If I’m a personal trainer that only has a sole proprietor business license, can I qualify for the tax write off?
Yes, You can write off a vehicle as a sole proprietorship
I thought there was a deduction cap of $25,000 in Section 179 for 6000+lbs. Is that referring to something else?
Good question. I am referring to bonus depreciation, which can be combined with Section 179 if you choose.
I'm new! And just subscribed
Welcome to LYFE!!! 💯
Little confused. So, by virtue of the total 179 deduction. Does that mean the IRS is sending you a total purchase price refund to your bank account ?
Does the car need to be of a certain year to qualify also?
Thank you that was great information
Tax deductions will never make the vehicle free.
That’s exactly right
duh
@@virtuouslady5679 I think Ron's point is that the title of the video is misleading at best.
This guy is clueless
The title says TAX FREE not a CAR Free
If you lease the car, are the lease payments deductible or is the value of the vehicle deductible?
When can i sell my car with out penalties ?
Yesss the SUV for my mobile business is on here! To bad it’s not gas efficient.
Great video as always, thanks for sharing. Why you did not list any Trucks like Ford F150 or Toyota Tacoma, etc etc...?
same reason why he didn't mention the dozens others
I have a tricky question, I have a home office that I write off, it’s a different room and I separate the cost of house by room, so when I use this 179 section when I leave to go to a work site or site of employment(company employed my company) driving from my home office to the work site is considered business mileage, in this case it would be completely tax deductible correct?
Not tricky at all, yes that counts! "Publication 587, Business Use of Your Home" Essentially you calculate the percentage utilized for business purposes. Can google this to pull up exactly how to calculate but yes that counts. :)
Yes those miles from the home office are deductible.
Started before you need to spend around two hours atleast at a home office they said. Other thing, if you make your vehicle an advertisement for your business I think it’s a loophole that makes all trips just about “business” as your promoting. Don’t quote me.
Can you please repeat GVW vs GVWR because there’s lots of videos using the two interchangeably and it’s confusing.
There’s a difference between the two
Same thing, the second one just has a redundant “rating” at the end, they both mean (the weight of the car, plus the maximum weight of all people and cargo)
you said it isn't a good idea to buy and a car via 179 and then sell it the next year and buy another the following year as so on every year or you might get in trouble. Why is that?
Great info! Could you show us a video on this topic but all electric videos?
Thanks for a great video! How much of a business credit limit should we have to be able to go into the dealership and drive out with that Range Rover? Its not as easy as it sounds for a brand new business, is it?
Yes this is the same question I have been asking and looking up online but there is no answer anywhere. In this reason, I believe the only thing I've found is that your business income has to meet the requirements for the banks to believe you can pay it off, therefore lets say you will need to prove you are making if not equal a greater annual business income to qualify for any car write off.
I'm sure you can't be a start up. I believe they want to see minimum three years, but don't quote me on that
What about the sales tax from buying the vehicle. Is that deductible?
Does asemi tractor and trailer qualify for an ecellerated depreciation write off?
This is utter BS. There is no way you can get a car for free. First of all you have to make $100k to write off $100k. Second the $100k are only taxed like 12%. So you will save $12k but you still pay $88k for the car.
This channel is awesome wow.
Thanks for great video, I am pretty sure there are some more vehicles qualify for this deduction, can anybody tell me where and how can I find them? Above 6000 GVWR, I am looking to buy 2022 Sienna, Odyssey or Honda Pilot, it only tell me curb weight. And my CPA guy told me that whatever weight that states on the title counts. I looked up title on my 2018 Odyssey it states 4,500 pound ( which is curb weight I assumed). Again, when I do google search it appears that Odyssey and Pilot both qualify, confuse me a lot. Which one is it? Curb weight or GVWR? Or title stated weight? Running out of time, can someone help me, really appreciate. Thank you
Over 6,000 Pounds, Sounds Like A Rolls Royce! 🎯
So if I buy a new G-Wagon (average price is $150,000) and I don’t want to take accelerated deprecation within the first year. How many years can I depreciate the vehicle and how much can I depreciate each year!? Thanks in advance! Love the video
Vehicles have a 5 year tax life, look up a MACRS depreciation table (depreciation rate varies year to year).
That is not a reasonable vehicle for that expense. You'd be asking to be flagged.
Thank you needed this key
Quick question is the gvwr or the auctual weight im
Trying to
Purchase the gle63 coupe . I tried to look it up n the irs website but luck could
You point me
To
The right direction thanks
Thank you so much!
You're welcome! Thanks for watching.
Jeep Wrangler 4xe too!
Question? What I got a G-wagon and 2 years later a shut down my business, bankrupt or sold it? What happens then to the tax of that vehicle?
do you have to buy the car cash or finance an option?
Hi I just talk to hr block, the lady confused me... If I buy a car over 6,000 pounds I'm a sole proprietorship, say I paid $80k, & don't owe the irs and I use 179 accelerated depreciation within the first year, when I file my taxes will I get the full 80k back returned into my account?
Thats what im wondering
Hey this video was a great help!! quick question though.
When you say, for example, the Tesla has an estimated tax deduction of $79,990. Would that be a yearly reoccurring deduction, or would the tax deduction only be applicable once the vehicle is done being used?
it would be a one time deduction and if you go into a loss it can be rolled over into the next year from my understanding.
He states in the beginning, instead of having the expense be split into 5 or so years, you combine it into the first year of purchase as why its called accelerated depreciation.
My small biz llc needs a new car to deliver and pickup customer equipment. So I can basically use this to buy a car that could help my biz? Plus can I record mileage on it aswell? I'm beating my original truck with pickups/deliveries and miles. My llc is 1 hour away from home!
You should definitely be writing off your mileage. What kind of business do you own?
@@LYFEAccounting small engine repair shop
Thank you!
Porsh Canine LOL
It's "Por-sha Cai Yan"
Will this deduction be available in future years? 2022-2025?
Makes absolutely no sense to me, what does it even mean to write it off, so you pay for it all then the government gives you the money back because you own a business ??
Do this apply to used cars as well?
did you ever find out? I would like to know too.
Question if just starting an llc and you expect a loss the first yr does it make sense to get a vehicle? Knowing year 2 will make profit?
If you need a vehicle? Yes. Because then without it wouldn’t you probably not be able to get the work done ?
All other videos state only 25K can be deducted, how exactly can I deduct the entire amount, say 100K for example, which tax form is this done in?
Using the trump tax law. It’s called bonus depreciation.
I have the same question
Does a rolls royce cullinan count since its GVWR is over 6000 pounds?
How badly do you want to be noticed for an audit? Lol
If I want a G wagon. How much do I have to make a year, how much taxes do I have to owe?
What amount of income must a business have to take advantage of this deduction?
Thank you
Would vehicles for Turo rentals be eligible for section 179? If so, can more than one vehicle be tax deducted?
Hey Steve, yes to both of your questions. What vehicles are you starting with?
I have a model 3 & Y. I plan on having the model s & x added to my fleet but definitely want to get more info on how to get the model x tax deduction since its gvwr is >6000lbs right?
Thank you
Can I use the depreciation tax of a 6k pound vehicle as a doordash driver in California? I'd buy the tesla X model if I could. Please share your thoughts thank you!
Honestly I think you could, especially since you're an independent contractor technically. Maybe creating an LLC for basically driving (maybe walk dogs).
How many times can you use this? Can you get 2 vehicles write one of on 179 one year and the 2nd vehicle the following year?
Great Video. Question - does the new Bronco, Badlands, sasquatch version qualify for tax 179? I believe it fits the criteria. Thank you
Did you ever find out the answer to your question. I’m curious if the bronco qualifies as well
@@tiffanieburns386 It does!
@@FirefighterMarcel95 Thanks for responding! Good to know bc I’ve been wanting one for awhile and thought it didn’t qualify. I looked of the weight and it was less than 6000 pounds online.
@@tiffanieburns386 so I got the badlands, sasquatch, package and it's 6,100 + lbs.
Aww man I wish I knew this sooner I just purchased a 2021 Chevy Trailblazer but it's under 6000 lbs 😫 ..
Maybe you could trade it in?
You can still depreciate up to $18,100