Strategies to Drive Down Taxes with Your Vehicle
Your vehicle is nothing else but a type of machine only that takes you from place A to place B. It becomes a super-charged tax-savings machine when you use your vehicle in your business.
You have many things to consider to maximize your vehicle deductions:
- How many dollars do you win by selecting the best vehicle deduction method?
- Where can you spend no money (zero, nada) but find vehicle deductions you never considered before?
- What does it take to claim tax deductions for two or three vehicles that you use for both business and personal purposes?
- What are the new benefits for business vehicles enacted with the Tax Cuts and Jobs Act (TCJA)?
In the articles below, you will find the strategies and perceptions listed above (and more) explained in simple-language to permit you to maximize your vehicle tax-savings.
Start saving tax dollars now. Access the ten popular strategy articles below:
TCJA Allows Bonus Depreciation on Purchase of Leased Vehicle
Good news. Bad news!
as in preceding years, buying the vehicle you lease destroys any opportunity to entitlement Section 179 expensing. Good news: the TCJA added two new provisions that now allow you to entitlement bonus depreciation on the purchase of a vehicle that you lease.
TCJA One Way to Deduct Personal Vehicle Used for Corporate Business
If you operate your business as a corporation but own the business car personally, you have no vehicle deduction possibility without corporate reimbursement, because the Tax Cuts and Jobs Act does not permit employee business expenses for years 2018 through 2025.
The law contains no fairness test for mileage. There are particular rules for recording mileage. We recommend that you keep a distance long for at least three consecutive months to prove your business-mile percentage.
IRS Saves Many Vehicles from the TCJA Bonus Depreciation Tragedy
Tax law limits depreciation deductions on what it considers luxury vehicles. The Tax Cuts and Jobs Act created 100 percent bonus depreciation, and that means you can deduct the cost of qualifying assets. One major exception is the $8,000 bonus depreciation cap that applies to a tax law-defined luxury automobile, crossover vehicle, pickup truck, or sport utility vehicle (SUV).
TCJA: Convert Personal Vehicle to Business and Deduct up to 100%
Tax reform under the Tax Cuts and Jobs Act gives you bonus depreciation and favorable rules for converting your vehicle and other assets to business use. On the conversion, you can immediately qualify to deduct up to 100 percent of today’s fair market value on your existing personal vehicle.
Tax Reform Allows Faster, Bigger Business Car Deductions
Lastly, lawmakers did the right thing by increasing the luxury auto depreciation limits on business cars. The old luxury limits were impractical, corrective, partial, and discriminatory against any car that cost more than about $15,000. The new restrictions don’t create similarity in all respects, but they are a big improvement.
Tax Reform Excise Tax Benefits of Business Vehicle Trade-Ins
Tax reform no longer permits Section 1031 exchanges on personal property such as your business vehicle. The trade-in was the most common 1031 exchange of a business vehicle. Now, because of tax reform, the vehicle trade-in is simply the sale of the old vehicle to the dealer and the purchase of a new vehicle. The deal to the dealer creates profit or loss on the sale just as it would on a total sale.
Don’t Let IRS Mileage Rules Destroy Your Vehicle Deductions
How much percentage of your business vehicles would you like to deduct? To reach your desired percentage, you need to apply and know the rules that the IRS refers to the mileage that you drive from your home to various business destinations.
Strategy Approved by the IRS and the Courts for Two-Car Tax-Deductions
You find new deductions without spending denomination or driving a mile farther when the two-vehicle tax-deduction policy will work for you. In this article, you find that both IRS and courts approve your use of two or more vehicles for business.
Deductible Home Office + Heavy Vehicle = Major Tax Savings
You likely have to control your business if you are a small business taxpayer. You can do much to increase your tax benefits with a qualifying heavy vehicle and a specific type of office in your home if you have control of your business. So, in this article, you will find a path about how to take some significant steps for tax savings this year.