Yep, I’ve seen folks do both. Take the deduction and get reimbursed. That’s an audit waiting to happen.
You're ignoring depreciation. 24K mi/year is destroying the value of the asset at almost twice the normal rate--the average annual mileage is somewhere around 12.5K mi/year. And the depreciation is going to be much worse on a newer car.
Depreciation doesn't mean a whole lot to guys and gals like me and you and @THAT Gurl who keep vehicles forever, but it is a factor in the calculation.
It used to be depreciation was a two edge sword if you took the depreciation down to zero then when you sold the item you had to show the money as income which could put you in a higher tax bracket.
That's why you drove past farmer Brown's place and he had 3 combines, 6 tractors, 11 vehicles and other equipment sitting in a field rusting away. He didn't want to show the income by selling them.
That's why you drove past farmer Brown's place and he had 3 combines, 6 tractors, 11 vehicles and other equipment sitting in a field rusting away. He didn't want to show the income by selling them.
Companies will often reimburse you on your paycheck, which is shown as taxable income on your W2, meaning you don't have to claim it as additional income. You need to keep an eye on how it's reimbursed.
Also, there's a loophole. For instance, if your wife works for a company that issues you a mileage reimbursement, and you have a side gig driving uber, you can get a reimbursal from the company for mileage THEN deduct the mileage from your taxable income. It's tough to say where those miles came from so proving they were the same miles out of all the non-business miles you're going to drive is impossible. You just need to make sure you're tracking your mileage for every drive.
MileIQ is a really good phone app for that. There are others, but that's my favorite.
This is still the case. You can sell them as "broken" and collect a cheaper bill, but you have to have the deductions to offset that bill. Most farmers don't have 5 million + in deductions, even from farm losses, waiting on the sidelines or carryovers.
The sad fact is that the ONLY reason they don't have that 5 mil in deductions is because taxes are complicated and no one is walking them through it. I'll die on that hill. Taxes should be simplified.
"How much did you make?"
"Now times that by 0.15"
"Enclose check"
That explains a lot about what we have observed over the years, especially so considering our Summer jobs take us out into the country a lot and see such junky places.
Vehicle depreciation is when you drive that brand new car off the lot you just lost value right there.
Well not entirely true all the time.. This chip shortage was a win for many people.
Some cars become collector cars of course but in my situation my cars will not drop another penny in value from the day i purchase them unless they are inoperable by the time I am done with them.
I just added cool factor points today for my 1957 Chevy 4 door.
My son's 2016 Freightliner clutch went out and I towed him about 10 miles back roads to the shop
with the 57 Chevy.
WIN!
I will say it is the heaviest thing I ever had to drag down the road.
One of these.
Well not entirely true all the time.. This chip shortage was a win for many people.
Some cars become collector cars of course but in my situation my cars will not drop another penny in value from the day i purchase them unless they are inoperable by the time I am done with them.
I just added cool factor points today for my 1957 Chevy 4 door.
My son's 2016 Freightliner clutch went out and I towed him about 10 miles back roads to the shop
with the 57 Chevy.
WIN!
I will say it is the heaviest thing I ever had to drag down the road.
One of these.
There you go again................ committing unsafe practices ...........................like overloading trailers.
HA HA.
He had it towed one time and I think less distance ,it was over $900
That hurts me more than towing it with my "family car"
He had it towed one time and I think less distance ,it was over $900
That hurts me more than towing it with my "family car"
