How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.

Ask Megan C Your Own Question

Megan C
Megan C, Certified Public Accountant (CPA)
Category: Finance
Satisfied Customers: 15588
Experience:  Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
23669918
Type Your Finance Question Here...
Megan C is online now
A new question is answered every 9 seconds

I live in KS and am planning on starting a small healthy food

Resolved Question:

I live in KS and am planning on starting a small healthy food vending business. My larger, one-time initial costs will include the vending machines, products and change($) to initially fill the machines, and business (LLC) set-up and licensing fees; all of which will be considered business expenses that may be written off. I plan to just charge mileage on my vehicle at the current reimbursement rate while I drive to and fro to fill/service the machines. However, I am also planning to trade in our 2010 sedan on the purchase of a full-sized truck to haul products and occasionally tow a trailer to move my machines as needed. My question is this: can I also write-off, as a business expense, the additional cost of purchasing the truck (after our 2010 trade-in), which I will also use for personal use a portion of the time? ...a majority of the time (i.e. > 50% of the time for personal)?
Thanks, Kirk
Submitted: 1 year ago.
Category: Finance
Expert:  Megan C replied 1 year ago.

MyVirtualCPA :

Hello, Kirk and thanks for your question

MyVirtualCPA :

You can only write off a portion of your truck purchase that is used for business purposes

MyVirtualCPA :

You cannot write off the entire purchase amount.

MyVirtualCPA :

You can choose either the actual expenses method, or the standard mileage method to write off deductions on that vehicle as well.

Customer:

I am only planning on using the delta between my trade-in value and the final purchase price of the truck (will be used).

MyVirtualCPA :

Also, you can't write off the entire purchase in the year of the purchase - you will have to depreciate the purchase

Customer:

It would be this delta cost amount that I would proportion relative to the ratio of miles driven for business vs. total miles driven, correct? Or proportioned based on time used for business vs. total time used? Which method is correct? or is either method correct? I am planning to use the standard mileage method; will this then negate my ability to write off a portion of the delta cost, or not?

MyVirtualCPA :

You would take the total cost of the truck, and take that cost over 5 years - and then take that expense and multiply it by the ratio between the business use miles and total miles

MyVirtualCPA :

You can use standard mileage or actual expense - but not both

MyVirtualCPA :

So, if you use standard mileage you could not depreciate the truck purchase

Customer:

Okay; understood. Finally, in your experience, and in general, does one method seem to outweigh the other with respect to minimizing taxes, given all things being equal? Or is one method better for reducing taxes more in the short-term and the other in the long-term? If so, which is which, generally?

MyVirtualCPA :

Generally, over the long haul the standard mileage will give you better tax breaks. In the short time, it's actual expenses

MyVirtualCPA :

I typically stay with the standard mileage approach

Customer:

Thanks; I appreciate you giving your opinion. I think that is it from my side. Any further words of wisdom or tidbits of knowledge?

MyVirtualCPA :

No, not that I can think of...just, when you have received all the information you need, please rate my response as "excellent" so that I may receive credit for assisting you today

Customer:

I can honestly do that. Many thanks.

MyVirtualCPA :

You're welcome

Megan C, Certified Public Accountant (CPA)
Category: Finance
Satisfied Customers: 15588
Experience: Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
Megan C and other Finance Specialists are ready to help you
Expert:  Megan C replied 1 year ago.
Thanks, Kirk for your positive rating. Please come back and visit MyVirtualCPA for any of your tax, finance, or social security needs. It was a pleasure working with you today.

JustAnswer in the News:

 
 
 
Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.
 
 
 

What Customers are Saying:

 
 
 
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
< Last | Next >
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
  • I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight. Bonnie Chesnee, SC
  • Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation. John Minneapolis, MN
  • Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with. Orville Hesperia, California
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C. Freshfield, Liverpool, UK
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex Los Angeles, CA
  • Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP Hesperia, CA
 
 
 

Meet The Experts:

 
 
 
  • Rakhi Vasavada

    Financial and Legal Consultant

    Satisfied Customers:

    2073
    Graduated in law with Emphasis on Finance and have have been working in financial sector for over 12 Years
< Last | Next >
  • http://ww2.justanswer.com/uploads/RA/rakhi.v/2012-7-3_14374_RakhiVasavadaL.64x64.jpeg Rakhi Vasavada's Avatar

    Rakhi Vasavada

    Financial and Legal Consultant

    Satisfied Customers:

    2073
    Graduated in law with Emphasis on Finance and have have been working in financial sector for over 12 Years
  • http://ww2.justanswer.com/uploads/BU/BusinessTutor/2012-2-2_115741_Kouki2.64x64.jpg Manal Elkhoshkhany's Avatar

    Manal Elkhoshkhany

    Tutor

    Satisfied Customers:

    1890
    More than 5000 online tutoring sessions.
  • http://ww2.justanswer.com/uploads/MY/MyVirtualCPA/2012-7-5_44024_cookmegan1.64x64.jpg Megan C's Avatar

    Megan C

    Certified Public Accountant (CPA)

    Satisfied Customers:

    1755
    Licensed CPA, CFE, CMA who teaches accounting courses at Master's Level
  • http://ww2.justanswer.com/uploads/JK/jkcpa/2011-1-16_182614_jkcpa.64x64.jpg JKCPA's Avatar

    JKCPA

    CPA

    Satisfied Customers:

    838
    Bachelors degree and CPA with Accounting experience.
  • http://ww2.justanswer.com/uploads/starside8/2010-2-16_55433_DSCN1175.JPG Eric's Avatar

    Eric

    Financial Manager

    Satisfied Customers:

    558
    Loan servicing, counseling and real estate expert. Foreclosure Expert and Financial Planner.
  • http://ww2.justanswer.com/uploads/FA/fastfile/2011-12-15_23139_Klein2011small.64x64.jpg R. Klein, EA's Avatar

    R. Klein, EA

    Accountant

    Satisfied Customers:

    397
    Intuit Ask a Tax Expert. QuickBooks Certified Pro Advisor (all editions)
  • http://ww2.justanswer.com/uploads/dkaplun/2009-05-17_173121_headshot_1_2.jpg Dimitry K., Esq.'s Avatar

    Dimitry K., Esq.

    Attorney

    Satisfied Customers:

    324
    NASD Licensed Rep, 1997-2001, Business Attorney
 
 
 

Related Finance Questions

Chat Now With A Financial Professional
Megan C
Megan C
2108 Satisfied Customers
Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level