We ended up owing $14K in taxes this year and keep thinking we should have probably gotten the new business vehicle to counter this in expenses.
1) If Leasing a new vehicle: it would be used 100% for the business. From what we understand, the expenses for the lease, insurance, maintenance, registration would all be a dollar for dollar tax write-off expense. Is this correct?
2) To buy a vehicle seems to be complex. Does the purchase include loan and insurance coverage? Does depreciation get factored in? Mileage isn't beneficial option for us, so that is off the table. Considering 100% business usage, how does owning stack up against leasing in this situation?
It seems like it would have been advantageous to have the expense of the vehicle lease write off versus owning?
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Your decision to buy or lease your company car depends heavily on your budget, intended vehicle use, and the tax implications.
It will be better for your business to buy the vehicle due the following reasons:
When you purchase the vehicle you can deduct all costs related to the vehicle (since you indicated it will be used 100% for business). You will be able to deduct the interest you are paying every month if you take a loan on the vehicle. Loan payments are not deducted as loan payments, rather you take depreciation expense for the vehicle.
It will be better for your business to lease the vehicle due to the following reasons:
Every business is diferent, therefore I have listed the advantages of leasing or purchasing the vvehicle. Please consider the above information and make the the choice that best suits the needs of your business
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