Any tax breaks left for buying an H2?

[Mr. I - Man]

Warning!!!

I am being audited as we speak! (they are really trying to Fvck me on this)
make sure you can account for the business miles with a log book and that you use the H2 at least 50% of the total mileage as business do not include commuting miles and also have receipts ie. oil changes and service to prove odometer readings on certain dates.

[robd1]

I won?t have a definitive answer as to what (or if) there is a tax break for business owners but here is what I found yesterday in addition to the posts so far. I thanks you all for your posts.

My CPA is off this week but I called his firm and spoke to another CPA. I don?t know the guy but he told me that ?to his knowledge?, the write-off for business owners is still in effect. He said the 100% write-off was nuked a year or 3 ago (which we knew) but there still should be a ?significant write-off for business owners?. This didn?t tell me much and I couldn?t really ask the guy to look it up and give me a definite answer since I?m not his client and not paying him. Anyway, it?s another positive confirmation that there is some kind of a decent a tax break out there for business owners. I won?t know the full details until Monday when my CPA comes back from vacation but I will post here what he finds and he is good.

I will agree with Mr. I-Man that whatever tax break is out there, you better be able to back it up on paper in case you get audited. If commuting to and from work does not count in the IRS?s eyes then it looks like you will need to have been keeping track of mileage, gas receipts and possibly dated receipts from the places you buy from to prove it?s legit. I won?t know the details until my CPA gets back but I?ll be happy to post what I find. Badging the vehicle for advertising might be another route and I?d happily do so if it saved me seriously money while advertising my business. I?ll check it out and post my findings next week.

By the way, for any business owner that has claimed this first-year deduction, does it absolutely have to be a brand new ?06/07 vehicle or does buying an ?05 with under 10k miles still count?

Rob

[OrangeCrush]

Originally Posted by robd1

whatever tax break is out there, you better be able to back it up on paper in case you get audited. If commuting to and from work does not count in the IRS?s eyes then it looks like you will need to have been keeping track of mileage,

Rob,

Thus the reason why when going through the menu for odometer, the H2's have a "business" and a "personal" way of tracking hours, mileage, gas used, etc....

BTW, mine is an '03 and the acct claimed whatever % was legal. (in reference to your '05 with 10K miles or under question)

Mark

[robd1]

Originally Posted by OrangeCrush

Rob,

Thus the reason why when going through the menu for odometer, the H2's have a "business" and a "personal" way of tracking hours, mileage, gas used, etc....

BTW, mine is an '03 and the acct claimed whatever % was legal. (in reference to your '05 with 10K miles or under question)

Mark

Does this personal/business option only work if you have Nav or is it a function in the odometer?

Rob

[robd1]

Ok my CPA called and confirmed the ?up to $25,000? first year write-off for business owners. He said there are variables that will influence the total but overall to expect around a $20-25k write-off. So Racer-X was dead on in his earlier post, thanks man.

The CPA also confirmed that commuting miles do not count. He said to log my miles and to be as detailed as possible which backs up what Mr. I-man was saying about his current audit. I asked him if badging out my hummer with company emblems/paint job would help but he discouraged it in my situation. He basically told me in so many words, to log and be able to backup what Mr. I-man said earlier. I?ve probably got several audit flags this year with starting a new business so I?m gonna play it by the numbers and just log everything.

So now the hard decision, should I spend $20-$25k to trade my 05? black loaded Ford Lariat (with 4k miles) for an 05? black H2 Lux SUT (with 4k miles)? Or do I keep my Ford and just pay the same $20k-$25k in taxes next year? Hmm?.

Rob

[HummBob]

Originally Posted by robd1

So now the hard decision, should I spend $20-$25k to trade my 05? black loaded Ford Lariat (with 4k miles) for an 05? black H2 Lux SUT (with 4k miles)? Or do I keep my Ford and just pay the same $20k-$25k in taxes next year? Hmm?.

Rob

TRADE IT

[Racer-X]

Originally Posted by HummBob

TRADE IT

X2

Holy sh*t my wife was right? Lucky guess.

[mikejr]

TRADE IT!

[Racer-X]

Originally Posted by robd1

I won?t have a definitive answer as to what (or if) there is a tax break for business owners but here is what I found yesterday in addition to the posts so far. I thanks you all for your posts.

Rob, just so you know I didn't pull those numbers out of my ass. The answer actually came from my wife, she is an EA (enrolled agent). It's kinda like a CPA except they specialize in taxes - that's ALL she does. Most EA's will run circles around a CPA when it comes to tax questions.

There are a few variables - but the numbers I posted are accurate.

[Motohead]

RacerX... my accountant said the same numbers to me...

[robd1]

I thank you guys for your replies and I sincerely mean that. My CPA just got back in town today and I spoke to him this afternoon, he will get back to me tomorrow with his findings about whatever changes took place (in May this year I think he said). Off the top of his head, he did concur with RacerX?s figures but he just wanted to check the latest changes to be sure.

He also thinks that the ?such-in-such clause?, or whatever he told me, would protect me if I bought used rather than new. This also he said he would have to research as well to see if the May changes effect that.

If the write-off is based on percentage of cost vs. a flat monetary value, it could make a huge difference as to if I buy new or slightly used. I?m basically just waiting on that figure before I decide. Thanks again guys!

Rob