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Tool Talk Discussion Forum

OT TAX QUESTION

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lenray

02-26-2007 10:41:33




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Thinking of leasing a pickup to use in the rental business.
Have alwlays owned but thinking of a lease.
Am familiar with SCH.E and Form 4562-Depreciation.
If the leasing cost is say 500.00 per month where is the legal correct place to place that figure on the tax form.
Looking for someone who has done this and or knows how to do this.
Thank you




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supergrumpy

02-28-2007 10:08:02




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 Re: OT TAX QUESTION in reply to lenray, 02-26-2007 10:41:33  
I've been wrestling with the IRS since 1981, nothing is ever as simple as you would hope it is

if you consider your use of a leased vehicle an "ordinary and necessary" expense of your rental business, I would put it under travel expense

IRS expects you to pro-rate business use versus personal use plus add back as income that same portion of the "lease inclusion amount" from their apendix tables

IRS auditor might ask some pointed questions if it comes to that

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Sid

02-26-2007 16:38:21




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 Re: OT TAX QUESTION in reply to lenray, 02-26-2007 10:41:33  
If we can get the FAIR TAX reform passed it will eliminate IRS and we won't have to worry about things like this.



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steve from mo - dangit!

02-26-2007 17:19:00




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 Please let us in on the joke. in reply to Sid, 02-26-2007 16:38:21  
How is a nationwide sales tax a FAIR TAX?

The devil is in the details. What do you tax and what do you exempt? How do you enforce it? All it has going for it is simplicity. Yes, I"ve read the material. I am just not convinced because (1) it is susceptible to all the political tinkering we have with the current system and (2) it is just as easy to scam as the current system.



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Sid

02-27-2007 02:03:02




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 Re: Please let us in on the joke. in reply to steve from mo - dangit!, 02-26-2007 17:19:00  
If you really want to know



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steve from mo - dangit!

02-28-2007 09:17:41




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 ...and... in reply to Sid, 02-27-2007 02:03:02  
Actually, I'd read their web page a few times. Don't take this the wrong way; but I do tax policy research as part of my job. That site has a lot of generalities and wishful thinking, presumably based on the fact that we haven't tried it yet so it has to be better than what we have now.

There are lots of promises made based on little or no actual information. There are also lots of coded words to attract people who cheat or feel victimized by the current system.

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Heh,Heh!

02-26-2007 14:31:46




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 Re: OT TAX QUESTION in reply to lenray, 02-26-2007 10:41:33  
Ol' Idee could prolly tell ya'! >;^))



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lenray

02-26-2007 14:53:32




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 Re: OT TAX QUESTION in reply to Heh,Heh!, 02-26-2007 14:31:46  
He liked you Mike but not me. He would tell you.



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Chad Franke

02-26-2007 12:39:53




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 Re: OT TAX QUESTION in reply to lenray, 02-26-2007 10:41:33  
I don't know what the tax implications are, but why would you want to lease it? Leasing is THE most expensive way to have a vehicle. If this is to rent out to people, the lease may not allow it, and you will get dinged big time when you turn it in for excessive wear and tear. Just curious about your thought process, I could be wrong (have been before) to think it's a mistake to lease.



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lenray

02-26-2007 13:02:12




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 Re: OT TAX QUESTION in reply to Chad Franke, 02-26-2007 12:39:53  
Thanks for the thoughts. I know leasing doesn't make much sence dollar wise.
I am not concerned with the cost--want to lease the Lincoln PU and want to lease a new one every two years.
I am a geezer and have paid my dues and want to drive a nice veh. Not looking for something to drive until the wheels fall off.
Every situation is different and if I was a young kid 30-55 I would think differently.

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steve from mo - dangit!

02-26-2007 12:26:21




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 Re: OT TAX QUESTION in reply to lenray, 02-26-2007 10:41:33  
It's not logical and you'd need to read the instructions for Sch E, but it is reported on line 18 Other (list). You may need to have a CPA or attorney with tax experience advise you. Doing taxes yourself is all well and good, but not if it costs you extra money.



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NEsota

02-26-2007 12:08:23




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 Re: OT TAX QUESTION in reply to lenray, 02-26-2007 10:41:33  
www.fairmark.com is where I go when I have a tax question. Give them time to respond.



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woodbutcher

02-28-2007 04:59:15




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 Re: OT TAX QUESTION in reply to NEsota, 02-26-2007 12:08:23  
That site has good tax info but nobody there seems to be willing to share any expertise on how to postpone drouth-related gain from the sale of cattle. I posted my question three days ago and have had no responses.
Butch



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lenray

02-26-2007 13:17:20




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 Re: OT TAX QUESTION in reply to NEsota, 02-26-2007 12:08:23  
Thanks NEsota for the site info.



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