Now is the time to convert! Not your religion. Your vehicle. You see, thanks to the Tax Cuts and Jobs Act, when you convert your personal vehicle to a business vehicle, you could save a lot of money. In fact, upon conversion, you can instantly qualify for a 100-percent deduction on the fair market value of your personal vehicle. Want to find out more about how to use … [Read more...]
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How to survive a business-mileage audit
IRS auditors are human. (Despite what you may think.) This means that auditors aren’t always familiar with every nuance of the tax code and so occasionally get things wrong. For example, you may be keeping a 90-day mileage log, but your IRS auditor may disallow all of your auto expenses because you can’t provide a 12-month mileage log. And the IRS auditor would be be … [Read more...]
Warning: Your “personal home” is not your “tax home”
“Home sweet home.” Sounds lovely doesn’t it? But if you’re not careful, Uncle Sam can turn things sour, fast. You see, the IRS makes a crucial distinction between your “personal home” and your “tax home.” And if you don’t know the difference between the two, and handle things the wrong way, you could lose valuable business-vehicle deductions. Want to make sure you stay … [Read more...]
Tax Reform Allows Bigger, Faster Business Car Deductions
If you bought a car in 2017 that cost over $15,800, Uncle Sam considered it to be a luxury car and put a lid on your depreciation. For example, if you bought a $40,000 vehicle and drove it 100% for business, your maximum depreciation deductions for the first five years would total just $15,060. And to fully depreciate the car would take nineteen years. Ridiculous! Well, … [Read more...]
Tax Reform Eliminates Tax Benefits of Business Vehicle Trade-Ins
Remember the good old days (a few weeks ago in 2017)? That was when you could use tax code Section 1031 to avoid paying taxes when you traded in a business vehicle for a replacement vehicle. (In 2017 it was the same story for an exchange of other personal property like equipment, collectibles and more.) Well, tax reform is here and it has killed the Section 1031 … [Read more...]