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I own a partnership. Planning to purchase a vehicle business

Customer Question

I own a partnership. Planning to purchase a vehicle for my business use. I don't drive a lot period. Is it more advantageous for me to lease the vehicle or purchase it? Can write off the lease payments 100% from my partnership? Does it matter whether the lease is in my personal name or company name?
There will be some personal use, but basically we don't drive that much for business or personal.
Submitted: 1 year ago.
Category: Finance
Expert:  Tax.appeal.168 replied 1 year ago.

Q1: Is it more advantageous for me to lease the vehicle or purchase it?

A1: I would say purchasing the vehicle would be more advantageous because you can claim Section 179 depreciation when your purchase, leasing you cannot. You can only claim depreciation on income producing property that is owned, not leased. You may also wish to refer to the following link:

http://smallbusiness.chron.com/business-tax-advantages-buy-vs-lease-vehicles-4315.html

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Q2: Can write off the lease payments 100% from my partnership?

A2: You can deduct the business percentage of the lease. Example, if you drive the vehicle 75% of the time for business purposes, you can deduct 75% of the lease payment.

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Q3: Does it matter whether the lease is in my personal name or company name?

A4: Yes, in order to claim the vehicle expenses under the partnership and the Section 179 depreciation, the vehicle needs to be in the name of the business. Refer to the link below for more detailed information:

http://quickbooks.intuit.com/r/money/fact-sheet-company-vehicles/

Let me know if I can be of further assistance to you regarding this matter.

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