IRS vs Viper payment as business deduct

[FE 065]

Say I'm going to make and sell widgets for Vipers, and need a Viper on hand to do development.

Aside from all the other qualifiers for deducting your car payment as a business expense, does 'the business' have to buy the car for the car payment to even begin to be deductible?

Or can I buy it my name and go from there?

 

[CANTDRIVE55]

You'll probably need to depreciate the Viper as a capital business expense.

 

[twinturbo3150]

Say I'm going to make and sell widgets for Vipers, and need a Viper on hand to do development.

Aside from all the other qualifiers for deducting your car payment as a business expense, does 'the business' have to buy the car for the car payment to even begin to be deductible?

Or can I buy it my name and go from there?

As Johnny Dangerfield would say "what's a widget" !!!!!!

 

[opnwide]

lease or depreciate it, and don't forget that personal property used for business is taxable locally (in Texas it is anyways). I keep my Viper out of the business and keep track of certain viper-related expenses entrance fees to events, hotels, travel and meals, etc.

 

[FE 065]

As Johnny Dangerfield would say "what's a widget" !!!!!!

widg·et, n.


A small mechanical device or control; a gadget. An unnamed or hypothetical manufactured article.

 

[Denny Wagner]

....a white midget????

 

[ledfoot]

If the 'Business" is not showing a profit the IRS can call it a hobby and back-tax your a$$.

 

[Hisserman]

You can buy it yourself and then transfer it to your company at a later date. But you can't deduct it until it is in your company's name.

If the company owns it you can depreciate it.

As several have suggested above, sometimes the easiest route is to have the company lease it and then deduct the lease payments as a business expense. If your company is too new or small to qualify for a lease, you may have to transfer some other collateral to the company to give the lessor some comfort.

 

[Bobpantax]

It never pays to do tax planning in a vacuum. Sit down with your accountant, who hopefully is a CPA and not a seasonal flash in the pan, and discuss what you propose to do and whether it fits in with your tax, cash flow and business plan. Section 162 of the Internal Revenue Code requires that a business expense, in order to be deducted, be ordinary, necessary and reasonable in amount. Even if the business owns the car or leases the car, it does not mean that the entire cost will be deductible - especially if there is peronal use of the vehicle. You also might wish to explore the cost of having enough insurance on the Viper in this context. Commercial coverage might cost alot more than a personal use, low mileage policy. A Viper bite incident resulting in damage to the property and persons of others could prove very costly. Good luck.