Finance Questions? Ask a Financial Expert for Answers ASAP
Hello...my name is XXXXX XXXXX I am a Certified Public Accountant. I look forward to assisting you with your tax question.
If you are using the mileage reimbursement method as allowed by the IRS of 56.5 cents per mile in 2013, you would not include the automobile on the balance sheet. Instead of using actual repairs and depreciation, you are using the standard mileage method per mile driven. Therefore, you would need to keep a written log of the business mileage driven for the year in order to know how much to apply at 56.5 cents per mile.
If it were listed as an asset on the balance sheet, you could take book depreciation against the amount to reduce the asset value on an annual basis, however, that would only be for book accounting purposes and not tax purposes.
ok, yes I need both for tax purposes just record expense, but for book purposes is it required to show it as Asset then the accum depr ? or just show the expense for tax and book purposes will be OK ?
My company is s sole proprietorship and I'm using my personal car as business car at 48% use for business ....
if needed to show as asset then I guess I start w fair Mrk Value when placed in service then apply the depreciation at (0.23 per mile in 2013 ) annualy to get accumm depr. ?
Hi...I apologize there was a disconnection in the site...
I am reviewing your questions now.
Since you are a sole proprietorship, you would not show the car as an asset...the main reason being that the car is titled to you individually. If you were the owner of a corporation and the car was titled to the name of the corporation, you would then be able to include the car as an asset on the accounting books of the corporation
Does that make sense?
didn get full answer not sure why u keep stepping out of chat,,,,
I apologize...for some reason I keep getting disconnected...
I am in the chat currently..
I am happy to provide additional assistance...
so I just need to show the expense ( Car Expenses ) , and at EOFYR just clear that expense vs some Owners Equity acctn ?
( I understood no need to show Vehicle as asset and no need to show accum depr )
Correct...you would include the expense under an expense category such as automobile and that will show up on your income statement for the year...the net income, depending on what type of accounting software you are using, will generally close out to retained earnings at 12/31 of each year
do I need to show R.E. at EOFYR ? some other CPA from ur website said no need to ...
just vs some Owners equity acctn ( same gl acctn used for Personal Draws of cash )
correct....retained earnings is similar to the owners equity account, which is basically a total of all of your contributions + net income - withdrawals
ok that answers my question competely ...tks will rate u postitive.....
You're very welcome! I apologize for the continuous disconnection
any way I can ask for u in future questions I might have ?
Yes...you can specifically request a tax professional by name when you list the question =)
ok will ask for u in future
what times are u on-line normally
I appreciate that...thank you very much! I am generally on from 9 am to 5 pm U.S. Eastern Standard Time
k tks , sorry for the poor rating before
will rate u excellent this time
No problem...it will be erased when a positive rating is listed
Thank you again! =)
ok bye for now
Have a great day!