Tax Guru's, EXPERTISE NEEDED!

[Leedog]

Here is the scenario:

I am married with two kids (figured id get that out of the way). I use my truck for company related business. It is not my business, but a 3/4 ton or larger truck is required by my company to be used/owned by me. I am given a $1250.00 monthly truck allowance that is to be used to cover a certain amount of insurance, routine maintenance, truck payment, and "general repairs"(this one is very gray). My company also pays 100% of my fuel used for company business. I drive on average 40,000 miles per year.

My question is, can I depreciate my truck mileage, and or repairs on my income taxes?

This has been a question amongst myself and coworkers for quite sometime. Some say yes, but I say no since we are given an allowance by the company to cover these things. It doesn't seem legit, and I am always afraid of getting audited, and owing back taxes + interest. Last year I took my taxes to a CPA for the first time ever, explained this, and his response was "well, I drive my car to work everyday, and I'm not writing any of it off." Needless to say I turbo taxed it again last year. Obviously we have two completely different scenarios. Others I work with take theirs to a CPA and they say to do it. Here is the other kicker. The truck is not in my name. I received a much better rate by putting it in my fathers name.

Should I find out if the monthly "truck allowance" is already being written off as a company expense, or does it even matter? Can I use 0.55 per mile as a general depreciation?

Any advice is welcome!

 

[Fuerza]

You need a tax professional. You've got a lot of variables that I don't think anyone can give you straight answers to.

 

[NC85]

Your best bet is to let Andy do them after he finishes the guards in the library.

Watch out for the sisters!

 

[george.arnold]

In my experience, you're going to get a different answer from everyone you talk to. Some CPAs are more aggressive than others. I own my own company and use my personal car for my business. I am reimbursed by my client for my driving expenses at .555 cents per mile. To be honest, I'm not even sure how my CPA deals with this. Taxes are beyond me.

I would guess that the company you are working for is definitely writing off some portion of that allowance they give you, just don't know how much.

 

[Leedog]

Your best bet is to let Andy do them after he finishes the guards in the library.

Watch out for the sisters!

WTF is this?:dw:

Maybe putting "any advice is welcome" was a mistake haha

 

[Leedog]

In my experience, you're going to get a different answer from everyone you talk to.

Agreed! The sad truth is, I'm willing to bet I get the same answer from any IRS audit agent. Which means there is a truth out there, it just needs to be found. Thanks for the input bud!:beer:

Any one else have any kind of similar experience/situation?

 

[Satyr]

WTF is this?:dw:

Maybe putting "any advice is welcome" was a mistake haha

It's a reference to Shawshank Redemption...

 

[Leedog]

It's a reference to Shawshank Redemption...

And now, instantly, its in Morgan Freeman's voice haha! Geez how could I have missed that!

 

[oldmodman]

If this truck is required in your job you can deduct all your out of pocket expenses that are not reimbursed by your employer. As to depreciation that would be unlikely unless you were paying for the truck and it was registered in your name.

 

[99cobrablack]

I'm kinda the same situation but i don't get reimbursed for anything, it's just me. Since I do use the pickup for business related things I can depreciate and deduct expenses, according to my tax lady. So I do.

 

[BlackOutUT]

First of all, I am not a CPA so take that as you will. As others have said, go to a professional and they will know what to do. That being said...

Many members of my family (mother, father, brother) and I are in sales so we all are in our cars a lot. But we all are paid for our vehicles in different ways. For instance, I do not receive a car allowance, only mileage reimbursement. My mother receives a car allowance and a gas card. Brother receives gas card and no car allowance. I also have an ebay business that adds another fun kicker in there. We have a family accountant that does all our taxes. From what I understand, if you are being taxed on your car allowance, (which I'm sure you are) then you can indeed write it off. So if your car allowance is being paid on your regular check, and you are using your truck for work purposes other than driving to and from work, then you can write it off no problem. Also when I say "write it off" I mean you can write off the depreciation of the vehicle, the interest paid on the loan, and some other things. A CPA will know more details about this. These laws are always changing and there are a ton of little loopholes, so if your not sure its always a good idea to talk to a professional. but looking at it from a far, I would say go for it.

The comment about the CPA saying "well I drive my car to work everyday and I don't write it off" is very odd and is not the same as your situation. I'm not sure why any CPA would ever say that. You use your truck for business. He's driving to and from work. The driving is not part of his job in the eyes of the IRS. At least thats the way it was explained to me.

Good luck with whatever you find out


Edit: I also don't see the vehicle being in your father's name as a problem. As long as you can prove you are the one driving it every day.

 

[JPD5801]

I know some will disagree, but my general rule of thumb is if the company reimburses you, don't claim it on your personal taxes.

Generally speaking, you only get one bite at the apple. You and your company can't both get a deduction for the same dollar being spent. Make sense? I know there are accountants who will claim all or some of it, but I tend to be more conservative.

 

[FordSVTFan]

it is an employee related business expense and is deductible to the degree you are not reimbursed. So, you get to depreciate it and take all the expenses associated with it minus everything you are reimbursed.

 

[WireEater]

OT: Hey Adman, good to see ya man... carry on.

 

[Leedog]

it is an employee related business expense and is deductible to the degree you are not reimbursed. So, you get to depreciate it and take all the expenses associated with it minus everything you are reimbursed.

None of it is "reimbursed". It is all fronted as a truck allowance. The check that is direct deposited shows as income, and counts as income.

 

[Jack Burton]

it is an employee related business expense and is deductible to the degree you are not reimbursed. So, you get to depreciate it and take all the expenses associated with it minus everything you are reimbursed.

Without reading into it in depth (it's not even busy tax season for me) but audit season has killed me. Read the instructions on the Form 2106, that should point you in the right direction.

My zombie ass is going to bed. Gotta get to the office at 5am to catch up


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