Author Topic: Vechile Purchase Depreciation Expense before end of year 2018  (Read 318 times)

freedom8991

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Vechile Purchase Depreciation Expense before end of year 2018
« on: December 15, 2018, 11:21:17 AM »
I am self employed consultant and travel about 35,000 miles per year for business purposes. My 1099 income was higher for 2018 than I had anticipated-so I am hoping to decrease my income on my taxes.  I just became aware that there is an option to purchase a vehicle yet in 2018 and depreciate it one time at 100% as well as there is an additional bonus depreciation. I would then use this car only for business purposes. My current vehicle-a 2012 Subaru-has 192,000 miles on it-so I have been considering purchasing a different vehicle-and selling/or sharing this one to my son-as I recognize it has some great miles left to it still.  So I am curious if I should consider purchasing a different car yet this year-and depreciating it 100% in 2018.  I would spend between $10,000 and $14,000 and would pay cash. What do I need to know to make this decision? I have googled the heck out of this option-and still cannot decide-It seems like a smart move-but I am nervous about spending that much cash...
 

DavidAnnArbor

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Re: Vechile Purchase Depreciation Expense before end of year 2018
« Reply #1 on: December 19, 2018, 08:14:11 PM »
I read about this option too.

I think that doing this method precludes you from doing the standard mileage deduction in future tax years with this vehicle.

Giro

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Re: Vechile Purchase Depreciation Expense before end of year 2018
« Reply #2 on: December 20, 2018, 07:49:13 AM »
For a vehicle at that price point and with your 35k annual miles, it's going to save you more money to use the standard mileage deduction.

freedom8991

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Re: Vechile Purchase Depreciation Expense before end of year 2018
« Reply #3 on: December 21, 2018, 04:50:44 PM »
Oh Gosh-that is good information to have-as I will absolutely wish to take the mileage deduction in upcoming years.

Thank you for your input!

DavidAnnArbor

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Re: Vechile Purchase Depreciation Expense before end of year 2018
« Reply #4 on: December 22, 2018, 05:44:34 AM »
I believe you can switch from one method to the other but there are a bunch of rules regarding that.