Business Vehicle - Best option w/ Tax Credit?

[flyak]

Looking for a bit of advice with a relatively complex situation. I have very little access to my CPA at the moment (currently buried in actual tax prep) or I would ask him. I understand most responses will be "speak to your CPA," but I am hoping for quick answers so I have some guidance and can abandon this idea if this is not going to work.

I own an LLC and need to replace my personal vehicle and am strongly considering a MYP considering the tax credit still exists. My personal income is below the threshhold, but my K-1 will not be next year.

1) Can an LLC purchase the vehicle and apply for the tax credit, or is it personal only? If yes, are there profit limitations?
2) Is K-1 LLC income considered personal income in the eyes of the IRS tax limit? Or only distributions / gauranteed payments?

Thanks!

 

[Nosken]

FYI-You might look at a Lease.
Other FYI-5 years ago, I couldn't use all my $7500 in one year, so the percentage of my business use on my car (ie:35%) was able to carry over. May not be able to be done anymore.
Have you looked into a Model X with the accelerated depreciation benefit with IRS Rule 179?-The Hummer Loophole?
I am not a tax guy, and I did not stay at a Holiday Inn Express last night.

 

[240vPlug]

Talk to your CPA or financial advisor. With that out of the way....

Leasing might be most beneficial...again you should talk to your CPA. You should get a $7,500 cap cost reduction on the lease. Then if you claim actual expenses you can write off the entire lease payment each month.

What I would do though is estimate how many miles you will drive. Make sure the actual expenses method gives you the bigger deduction. If you drive >20,000 mi per year then leasing might not be a good choice. You really need an expert who knows your specific situation to analyze this and make recommendations.

 

[Nosken]

A very simple way to keep track of your mileage, the $50 a year for TeslaFi is very beneficial.
If you use my referral link, you will get one month free trial rather than two weeks. Otherwise just go directly, it’s very worthwhile.

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