Level 2

Vehicle Purchase

Forum|Forum|2 years ago
November 21, 2023
3 replies
18 views

A client is purchasing a new car under personal name for business use and company will pay for it. What is the best way to go about that? Would section 179 and bonus depreciation apply in this situation?

sjrcpa

Level 15

What type of legal entity is the "company"?

The more I know the more I don’t know.

L

LanaDallasAuthor

Level 2

LLC, S-corp

abctax55

Level 15

Why not have the entity buy the vehicle?

Will it be 100% business use?

Type of vehicle will impact depreciation calculations as well.

HumanKind... Be Both

IRonMaN

Level 15

New approach to last week's question?

Solved: Vehicle Purchase - Intuit Accountants Community

Slava Ukraini!

abctax55

Level 15

Good catch, Jeff.

HumanKind... Be Both

qbteachmt

Level 15

Let's translate this:

"A client is purchasing a new car under personal name for business use"

Is a "POV" = personally owned vehicle, then.

"and company will pay for it."

Nope.

"What is the best way to go about that?"

The company pays this person wages through payroll. The company can accept a business mileage report under the terms of An Accountable Plan and reimburse per the IRS mileage rate and this is not taxable to the shareholder-employee.

"Would section 179 and bonus depreciation apply in this situation?"

No. The Company doesn't own this vehicle. You stated that clearly.

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