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Aug 4, 2008 9:12 pm

I live under a bridge near the office.  No need for a nice leased car, just a short walk down the shoulder of the freeway.

Aug 4, 2008 10:09 pm
ezmoney:

true, but who wants to drive the same car for ten yrs? Man that’s no fun if you have the jack to lease a different one every 3.

  Oh, I don't know.  There are several cars that I wouldn't mind driving for a long time   http://i48.photobucket.com/albums/f213/Lugnut67/49roadmaster.jpg Not mine but I wish.  
This one is mine that I'm restoring http://i48.photobucket.com/albums/f213/Lugnut67/blazer1.jpg   And this one WAS mine but I sold it  http://i48.photobucket.com/albums/f213/Lugnut67/fordside.jpg Kind of wish I still had it.    I'm off for the rest of the week...Going to Reno for Hot August Nights!!! 
Aug 11, 2008 11:11 pm

here’s the deal. I’m looking at a 2008  E350 Benz with 8k miles p1 pkg, sports pkg, blk ext and tan int. $43900. I think I can buy for 42900 with mfg warranty plus another 50k/5 yr certified warranty. I plan on buying it for 42500. good deal?

Aug 12, 2008 5:15 pm
ezmoney:

here’s the deal. I’m looking at a 2008 E350 Benz with 8k miles p1 pkg, sports pkg, blk ext and tan int. $43900. I think I can buy for 42900 with mfg warranty plus another 50k/5 yr certified warranty. I plan on buying it for 42500. good deal?



Check the PM I just sent you.
Aug 12, 2008 6:20 pm

[quote=Indyone]Absolutely.  You can depreciate your vehicle, SUBJECT to luxury limits and and a useful life determined by the IRS.  How would you like the IRS saying your car is too nice so you can only depreciate a portion of $25,000, instead of the full $50,000 it costs?  Depreciation rules suck, so I just decided to avoid them altogether with a lease.[/quote]

How about expensing the car expense via IRS mileage allowance… IF you lease a car for $400.00 you can only deduct up to 400 X 12= $4,800.00 a year.  If you drive substantial miles for business (at $0.485 per mile) you will make out alot better than leasing the car.  Depends on how much you drive…

Aug 12, 2008 6:28 pm

Leasing, you can also deduct actual expenses (repairs, maintenance, gas, etc.)

Aug 14, 2008 4:04 am

Rugby, when all expenses are considered, it's going to be a rare day when IRS standard mileage beats actual expenses (and BTW, your IRS rate is old).

Aug 14, 2008 1:01 pm

Indy-

Perhaps you are right with gas prices, etc.  I do see the new rate went up to just  .505.  Consider these (2) examples:

Car 1 (Lease)-  Leased car…$350.00 per month and drive 15.000 miles a year for business.  Car gets decent MPG (22).  You write off the lease payment , gas costs, maint. & repairs.  A new car should have very little maint. costs in the first 30 - 40k miles.  What is your write off?  Approx $7,000.00?  Allowing for gas, light maint. etc.

Car 2 (Purchase)-  Purchase a car (purchase outright or finance at 1.9% likes most of these automakers are doing).  Write off is approx.  $7,500.00. (15K business mies @ .505). 

Example 2 at least your payments are going towards owning the car.  You can still get a decent write off with standard IRS deduction, but do need to drive some business miles .    What about property tax deduction on lease versus buy?  Interested in your opinion on these scenarios…

Rugby

Aug 14, 2008 10:23 pm

#1, I’ll repeat an earlier assertion…leasing is much more appealing for a business owner over an employee.

  On current mileage rates:

2008 IRS Mileage Rate posts increase over 2007 rate of 48.5 cents

The 2008 IRS mileage rate for business use is:

50.5 cents per mile from January 1 through June 30 58.5 cents per mile from July 1 through December 31, 2008

The depreciation limits for OWNED (vs. leased) cars completely sucks.  See link:

http://www.finance.cch.com/text/c60s15d625.asp   Finally, on your write-off example on car one, you forgot insurance and license plate fees (which you later referenced).  Also, maintenance writeoffs are very broad.  I include detailing costs...pretty much anything to do with maintaining a car.  The last thing is, you're not going to get much of a car for $350/month, IMO.  At that level, buying may make more sense.  My lease payment is about $480 give or take (don't have the number in front of me).  After taxes, it costs me just a bit over $300/month, which in my mind, is a pretty cost-effective way to drive a brand new Chrysler 300, particularly when my fuel and other associated costs are also tax deductible.  There's no question in my mind that when I tally all costs, it's more than even 58.5 cents per mile driven for me.  Every situation is unique, and if I were driving 30,000 miles a year, the math would be considerably different.   For the record, I have never leased a personal (non-business) vehicle and I doubt if I ever do unless the math changes considerably.  A personal vehicle, driven a few business miles each year is not lease material IMO.
Aug 14, 2008 11:08 pm

Good posts Indy, as a CPA, I agree.

Aug 15, 2008 10:25 am

my cpa says there isn’t much difference between leasing and buying a 30k car from a tax standpoint. he takes about 70% depreciation on my car for business use.  he then treats my auto expenses (maintenance, gas, taxes, registration,etc) at 70% as an expense. he said if I buy a more expensive car, say 40k than it might matter a bit.

  He says if I were to lease one he would treat it the same way. is his thinking wrong?   Indy, you don't have a problem renting your car and having nothing to show for it in the end?
Aug 15, 2008 6:39 pm

ez,

Your CPA's thinking isn't wrong.  If you use the car 70% of the time for business, then that's what the write-off should be.  Almost no vehicle is 100% business, claiming that could be getting too greedy and send up a red flag for the IRS.   I think it's personal preferences when it comes to leasing or buyinig.  I would prefer to own rather than rent.
Aug 16, 2008 7:28 pm
"Indy, you don't have a problem renting your car and having nothing to show for it in the end?"   For what I'm paying with nothing down?  Nope.  This got me a fairly nice auto and I pocketed the sales proceeds of my former car and am can add to that while I'm leasing if I choose.  I don't owe a nickel on any of my vehicles other than my business lease and that includes (besides the 300) a convertible, a 4WD quad cab truck and two motorcycles.
Aug 17, 2008 7:03 pm

[quote=iceco1d]

  As far as the car goes...personally, I'd get the SLK350, or the SLK 55 AMG, over the E350; but that's just me.  [/quote]
I think he is a guy not a chick so the SLK is out lol!
Aug 17, 2008 7:10 pm

Hey, I like the SLK - as long as it’s silver or black. 

Aug 17, 2008 7:19 pm

[quote=skippy]Hey, I like the SLK - as long as it’s silver or black.  [/quote]
Small 2 door vert=chick car
Z3/Z4, Miata, SLK…etc etc

Where I am from Mercedes are as common as Chevy’s and SLK’s and Z4’s are mostly driven by Housewives…very odd to see a straight male driving one lol!

Aug 18, 2008 6:09 am

[quote=iceco1d]Yea…SLK 55 AMG is a chick car. 

  5.5L v8.  400+ whp.  19" Rims.  I think I'll get my wife one...[/quote]
AMG's are nice, juct can't get past the 2 door roadster thing. I certainly wouldn't get one for my wife...BTW my wife has a 700+ RWHP car, so she would think a 400 Hp car is for sissy's lol...
To each their own... CLK AMG...if anything, if you want a 2 door..if a Mercedes is your thing. Really I would go minimum of the E 63

Oh BTW the SLK AMG has 360 hp at the motor...so that is probably about 300 at the wheel...not 400 :)
Aug 20, 2008 8:19 am

indy,

  would you ever put down $$ for a lease, if so what is the top end?
Aug 25, 2008 5:42 pm

FYI, I bought the E350. WHat a great car!

Aug 27, 2008 8:34 pm

congrats ezmoney! now do some gross so you can pay for it