GEN 2 Owner age poll

[photoneffect]

There are certain benefits from having a monthly payment and writing that off vs paying it all outright.

But how is it a tax benefit? If you buy it outright and write that off it's still less money than financing and paying the interest even if you can write the interest off too. It's still costs more that way.

 

[KTMRC8]

But how is it a tax benefit? If you buy it outright and write that off it's still less money than financing and paying the interest even if you can write the interest off too. It's still costs more that way.

I don't know the exact tax laws (for writing off a 70k vehicle outright), but I do know mathematically it makes more sense to deduct 10k-12k per year over 5 years from taxes (which most people would benefit from) vs a 70k write off for a single year (which not many would be able to take advantage of).

 

[Azholley]

How is financing a tax shelter?

Debt to income ratio. When you have businesses you don't want to pay for things in full cause you need the debt write offs unless you have enough debt. In my situation I don't have enough debt to write off.. houses, more business loans, cars etc. if I don't have debt the IRS rapes me with taxes on the extra income every year from my previous paid off loans. I will lose more money in taxes on income for the businesses vs the APR of 1.9% on my truck by far.


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---------- Post added at 08:42 AM ---------- Previous post was at 08:41 AM ----------

I don't know the exact tax laws (for writing off a 70k vehicle outright), but I do know mathematically it makes more sense to deduct 10k-12k per year over 5 years from taxes (which most people would benefit from) vs a 70k write off for a single year (which not many would be able to take advantage of).

This is correct too. You can work it numerous ways.


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[photoneffect]

Debt to income ratio. When you have businesses you don't want to pay for things in full cause you need the debt write offs unless you have enough debt. In my situation I don't have enough debt to write off.. houses, more business loans, cars etc. if I don't have debt the IRS rapes me with taxes on the extra income every year from my previous paid off loans. I will lose more money in taxes on income for the businesses vs the APR of 1.9% on my truck by far.

Your debt to income ratio has no bearing on taxes. Banks use that to determine if they'll give you loans. The only thing the IRS cares about is how much income you earned. If you buy it outright your income is reduced and your taxes are lower.

---------- Post added at 10:49 AM ---------- Previous post was at 10:47 AM ----------

I don't know the exact tax laws (for writing off a 70k vehicle outright), but I do know mathematically it makes more sense to deduct 10k-12k per year over 5 years from taxes (which most people would benefit from) vs a 70k write off for a single year (which not many would be able to take advantage of).

There is some truth to this, but only if you are only in the highest tax bracket by less than $70k or you plan to earn more the following years. But honestly I just don't believe the 26 year old and his 5 businesses. At the very least he needs to hire better tax experts.

 

[Azholley]

Your debt to income ratio has no bearing on taxes. Banks use that to determine if they'll give you loans. The only thing the IRS cares about is how much income you earned. If you buy it outright your income is reduced and your taxes are lower.

---------- Post added at 10:49 AM ---------- Previous post was at 10:47 AM ----------





There is some truth to this, but only if you are only in the highest tax bracket by less than $70k or you plan to earn more the following years. But honestly I just don't believe the 26 year old and his 5 businesses. At the very least he needs to hire better tax experts.

Ok man lol. This isn't personal taxes I'm talking about. I'm not gunna argue about it though so I'll do what I do and you can do what you want.


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---------- Post added at 08:52 AM ---------- Previous post was at 08:50 AM ----------

Your debt to income ratio has no bearing on taxes. Banks use that to determine if they'll give you loans. The only thing the IRS cares about is how much income you earned. If you buy it outright your income is reduced and your taxes are lower.

---------- Post added at 10:49 AM ---------- Previous post was at 10:47 AM ----------





There is some truth to this, but only if you are only in the highest tax bracket by less than $70k or you plan to earn more the following years. But honestly I just don't believe the 26 year old and his 5 businesses. At the very least he needs to hire better tax experts.

I'll let my dad know he sucks at being a CPA and he's fired. And it's 4 hoping for 5 at the end of the year [emoji1589]


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[df4801]

I don't know the exact tax laws (for writing off a 70k vehicle outright), but I do know mathematically it makes more sense to deduct 10k-12k per year over 5 years from taxes (which most people would benefit from) vs a 70k write off for a single year (which not many would be able to take advantage of).

Uhhh, sorry, no it doesnt make sense mathematically.

Almost always better to take the full deduction as soon as you can. Consult your CPA if you need more info on this.

 

[Hobert]

When I started reading this thread, I would have never predicted it would devolve into a tax discussion...

 

[photoneffect]

When I started reading this thread, I would have never predicted it would devolve into a tax discussion...

I think it's like Godwin's law. The longer an online conversation involving buying things goes it invariably descends into an argument about tax law.

Now if it were bird law we could go *** for tat.

 

[KTMRC8]

Uhhh, sorry, no it doesnt make sense mathematically.

Almost always better to take the full deduction as soon as you can. Consult your CPA if you need more info on this.

My CPA said the exact opposite, lol. My wife and I would be throwing away deduction money if we wrote of 70k outright (on top of our mortgage and other business deductions). 10k on the other hand easily helps lower our tax burden and extends through the next 5 years...

Futhermore, any smart financial planner would tell you to finance the whole thing because you can easily make more return on investment than the 1.5% auto rate I'm getting...

 

[Aaron]

My CPA advised me to buy a Gen2 at $20k ADM and invest heavily in illicit drugs and comfort women. He seems to know what he's doing so far...


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