To: vto
The question is over how many years they are allowed to deduct the vehicle. Most of us know but forget a deduction is not a tax credit. Say a 56k vehicle can be depreciated over 7 years and a Hummer is 56k, then one can deduct 8k per year. If you are in the 30% bracket, the government "pays" for $2400. Therefore over the life of the vehicle, the government pays $14,800 of the cost of the $56,000 vehicle. However, when you sell the Hummer or trade it in, you must recapture the money you receive. Assume you sell the vehicle for $25,000, you must pay $7500 in taxes. Therefore the government pays for $7300 of the cost of the vehicle. My point is that this article is very misleading implying the government gets "hosed" for the full price of the vehicle which they do not.
4 posted on
01/01/2004 6:17:14 AM PST by
AZFolks
To: AZFolks
Well, the deduction can be frontloaded as a Chapter 179 expense deduction, and this has been true for years.
I don't think there is anything new in the tax code this year about this subject.
The vehicle must be for business use, it must not be a passenger automobile, and it must weigh more than 6000 lb.
9 posted on
01/01/2004 6:22:02 AM PST by
Jim Noble
To: AZFolks
See your accountant. The new law allows a full deduction of up to 100K in the first year for any vehicle with a GVW of 6000+ lbs.
To: AZFolks; ambrose; Roscoe; Avoiding_Sulla; ElkGroveDan; farmfriend; Carry_Okie; NormsRevenge; ...
"Therefore the government pays for $7300 of the cost of the vehicle."Are you serious? The government can't pay for anything!!!
It steals the money in the first place with "Ill Gotten Gains!"
Thou Shalt Not Steal! Government Hates Competition!!!
And finally, since government doesn't produce anything, how could it possible PAY for anything?
50 posted on
01/01/2004 8:25:21 AM PST by
SierraWasp
(Tell me what made you happiest in 2003? Nobody wants to hear the rest of it !!!)
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