The optimal scenario is that your business makes at least $120,000 in pass-through income for a given tax year AND you acquire the SUV in December. Keep records and drive it 100% for business until Jan 1. You can claim 100% business use for the year and take accelerated/bonus depreciation, wiping out lots of taxable income. Realistically, you can have the Feds kick in $40k+ this way. Applies to business income - that's on top of whatever "fair" compensation you might pay yourself as an employee.
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TESLA X section 179
- Thread starter EXOTIC1
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No it does not. There is a lot of false information going around about gross vehicle weight being over 6,000 lbs. However, the law states the unloaded gross vehicle weight (curb weight) must be over 6,000 lbs. Reference IRC section 280F(5)(a).
This is wrong. The law is about curb weight (unloaded gross vehicle weight), not gvwr. Reference IRC section 280F(5)(a)
YES, the Model X does qualify for the bonus depreciation.
2019 Tax Code 179 Vehicle Guide For Self-Employed & Business Owners | CarProUSA
The CarProUSA annual guide to Tax Code Section 179 for self-employed and business owners encompasses qualifying vehicles purchased in the 2019 calendar year.
ithinkmac
Member
No, for the 179 and bonus depreciation. it's based on GVWR. Not curb.
It is based on “unloaded gross vehicle weight,” which is the curb weight. Refer to IRC section 280f.
That information is incorrect. Please refer to the actual law below: 26 U.S. Code § 280F - Limitation on depreciation for luxury automobiles; limitation where certain property used for personal purposesYES, the Model X does qualify for the bonus depreciation.
2019 Tax Code 179 Vehicle Guide For Self-Employed & Business Owners | CarProUSA
The CarProUSA annual guide to Tax Code Section 179 for self-employed and business owners encompasses qualifying vehicles purchased in the 2019 calendar year.www.carprousa.com
unloaded gross vehicle weight is the curb weight.
Actually, reread your own section. Passenger cars are treated differently than "trucks and vans" which are not defined other than: "In the case of a truck or van, clause (ii) shall be applied by substituting 'gross vehicle weight' for 'unloaded gross vehicle weight'."
From my reading, it seems that "trucks and vans" get to count loaded weight in their GVW.
Depreciation Guidelines for Vehicles and When to Report Them as Listed Property
If business vehicles are passenger automobiles, they are listed property and are subject to limits on the amount that can be deducted for regular depreciation, as a bonus depreciation allowance, and as a Sec. 179 expense.
www.thetaxadviser.com
These people seem to agree: "Significantly, for autos, the 6,000-pound limit is based on the unloaded gross vehicle weight of the auto, while for trucks and vans, the 6,000-pound limit is based on loaded gross vehicle weight, which includes passengers and cargo. This means that most full-size pickups and larger vans will be over the 6,000-pound limit and not subject to the Sec. 280F depreciation limits."
The Model X is Not a "passenger" vehicle. It is a SUV.
just people someone says you can do something does not mean they are correct. The majority of my job is dealing with crooked CPAs and Lawyers that swear they were not committing fraud.Actually, reread your own section. Passenger cars are treated differently than "trucks and vans" which are not defined other than: "In the case of a truck or van, clause (ii) shall be applied by substituting 'gross vehicle weight' for 'unloaded gross vehicle weight'."
From my reading, it seems that "trucks and vans" get to count loaded weight in their GVW.
Depreciation Guidelines for Vehicles and When to Report Them as Listed Property
If business vehicles are passenger automobiles, they are listed property and are subject to limits on the amount that can be deducted for regular depreciation, as a bonus depreciation allowance, and as a Sec. 179 expense.
These people seem to agree: "Significantly, for autos, the 6,000-pound limit is based on the unloaded gross vehicle weight of the auto, while for trucks and vans, the 6,000-pound limit is based on loaded gross vehicle weight, which includes passengers and cargo. This means that most full-size pickups and larger vans will be over the 6,000-pound limit and not subject to the Sec. 280F depreciation limits."
An SUV is a passenger vehicle and does not qualify as a truck or van. If it did, it would be called a truck or a van and not an SUV. By the law any passenger vehicle that has not be defined by the law as a truck or a van (this means work van by the way, not mini-vans) has to weigh over 6,000 lbs curb weight to hopefully qualify.
This means, if you were audited, you would have to prove that and SUV is a truck or van. Now let’s say you did somehow prove that SUVs were trucks or vans, you would then need to prove that specific vehicle, was usual and necessary (per IRC 162) to operate you business in order to have any expenses affiliated with it allowed on your taxes. So your job would be to prove to me that it was normal and necessary for people in your industry to buy $100,000 vehicles to do that same thing a $10,000 vehicle could. If you could not prove that, it then appears you are purposefully attempting to defraud the government.
I deal with this every day. If you can provide me any LAW supporting your opinion. Heck, I would even accept a FEDERAL COURT Case.
You do realize that according to the IRS and SUV qualifies as a passenger vehicle. Find me a federal law that says different. I showed you what qualifies as a passenger vehicle (manufactured primarily for use on public streets, roads , and highways).
I guess if you could get Elon Musk to officially announce that the model X was created specifically for off-road use, you might have a chance at winning in court.
Does section 179 apply to only a new MX or can it be used towards a used MX for example, a 2017 or 2018? Also, i know every situation is different, but I just started my LLC last month and by the end of the year will only have about 40k in revenue, with my expected revenue for 2022 to be between 250-300k.
Would a straight line depreciation over 4 years be more beneficial over section 179 if i purchase it a used MX in december and claim 100% business use? Any advice/general guidance would be greatly appreciated. Thanks
Would a straight line depreciation over 4 years be more beneficial over section 179 if i purchase it a used MX in december and claim 100% business use? Any advice/general guidance would be greatly appreciated. Thanks
Hey SS, I'm in Berkeley as well looking into what you considered a year ago. How did it work out happy to chat
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