Does BUYING a CAR Dec. 31 save you money on taxes? We are fast approaching the end of year tax spend, which befalls many business owners and bonus babies. Congress has not officially passed the sales tax write-off rules of past, which allows consumers to deduct the sales tax on large items like cars and trucks, on their 2015 tax return. Businesses have for years used Section 179 to spend on much needed business equipment, that has not changed, although the caps for specific businesses or budgets should be discussed with your accountant BEFORE you go crazy.
The CARS and TRUCKS BUYING BINGE of yesteryear, also known as the FARM BILL, allowed for the purchased of vehicles weighing over 6000 lbs. to be categorized as business equipment, resulting in a boon for Chevy Suburban, Land Rover and Ram truck dealers. The farm bill went away, and as such, business owners are left with Section 179 or the rules of lease versus buy to determine the best way to spend on vehicles this year.No more 6,000 lb. bonus.
FROM THE IRS WEBSITE:Beginning on Jan. 1, 2015, the standard mileage rates for the use of a car, van, pickup or panel truck will be:
- 57.5 cents per mile for business miles driven, up from 56 cents in 2014
- 23 cents per mile driven for medical or moving purposes, down half a cent from 2014
- 14 cents per mile driven in service of charitable organizations
2015 has the best window of opportunity in low interest rates while they last. With auto manufacturers and credit unions vying for good credit clients, a FICO AUTO score of over 700 is a win, even if you are using the vehicle for business. With rates destined for blue sky, make your best deal on a purchase. If the car you want is over the federal tax guidelines for the most advantageous depreciation. Consider leasing. The low money factor is still of benefit, and you can own the vehicle at the end of the lease for the residual or buyout. The tax advantages may be more beneficial to you. Discuss this with your accountant or tax planner. ——————— Sarah Lee Marks is MyCarlady. She has over 26+ years of experience. She writes about cars, and is a staunch consumer advocate on car related subjects. MyCarlady offers free car buying advice, and private, auto-related services to help you maintain your personal or commercial vehicles. Call Sarah Lee for more information. Join the MyCarlady newsletter to be kept up-to-date on this and other important car information. —————————————————————————————————————————– ]]>Biggest Bonus of 2015 0% while it lasts.