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Which option brings more tax savings for S-Corporation owned…

Which option brings more tax...
Which option brings more tax savings for S-Corporation owned or leased vehicle?
Trying to figure out either lease or finance the automobile for business purposes.
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Answered in 4 minutes by:
3/11/2018
Carter McBride
Carter McBride, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 1,273
Experience: Adjunct Professor
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Hey! I'm Carter, I'm a CPA and can help you out.
If you lease and take actual expenses, then you can deduct lease payments. If you use standard mileage, you cannot take the lease payments.
If you purchase the vehicle, it is depreciated over 5 years, but you can get a large 179 deduction the first year.
In the end, these differences will offset and be equal. For the best tax break now, then buying is your best option.
Let me know if you need anything else. If not, please leave a rating. Thanks!
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Customer reply replied 4 months ago
Thanks for your answer. I thought if it’s company owned, mileage can’t be used. Is that right?
That's correct.
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Customer reply replied 4 months ago
6000 pound or less weight cars are luxury cars and section 179 can’t be used, right?
Whats the max depreciation deduction for first year for luxury car? I assume most cars are treated as luxury for tax purposes
Right, no 179 on luxutty autos.
You can do $8,000 of bonus depreciation and $10,000 first year depreciation as the max.
Carter McBride
Carter McBride, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 1,273
Experience: Adjunct Professor
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Carter McBride and 87 other Tax Specialists are ready to help you
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Customer reply replied 4 months ago
Last follow up question, then is it total $18,000?
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