@rwaldenjr wrote:
Thomas -
Thank-you for further clarifying George's reply about tax deductions and depreciation of property assets. However, I sense that you're still assuming I'm selling the vehicle. What are the tax advantages/disadvantages and depreciation parameters around gifting the vehicle to my contractor rather than selling it? Am I able to gift a company asset? If so, would I have to gift it for: a. the vehicle's FMV; b. the property asset value (which in this case greater than FMV, based on the original purchase price); or, c. a reduced value below FMV?
You can't legally gift the vehicle to your contractor. It's something given in compensation for their services performed, which means the value must be included on their 1099-NEC. (Same with barter, which must be reported in the same way.)
It's only a gift if it is a true gift with no strings attached, is not related to your business, you would have made the same gift even without the business relationship, and there are no future expectations such as continuing to work for your company.
