Should I Buy or Lease a Car for my Business?

[@UrbanTarantulas]

Can you get bonus depreciation if you purchase a USED vehicle?

[@MrCPA-ry8mv]

Yes, I believe you can

[@tesagardlik2746]

Thank you for this video. It is very helpful for decision making, especially when a lot of people on youtube are recommending to lease. I always purchase a car-for personal reasons. Quick question, once you set up your business, how soon can you purchase a vehicle? Does the business need to be making money in order to do that? Thank you

[@MrCPA-ry8mv]

You’re very welcome! You do not need to have a profitable business to purchase a business use vehicle. However, it is important to make sure your business does not qualify as a hobby where losses would not necessarily be allowed and thus a vehicle purchase may not be deductible.

[@DT-fp5sz]

Thanks for the vid! Can I use my newly acquired EIN to purchase the vehicle or do I have to use personal credit?

[@MrCPA-ry8mv]

It would depend on the bank if they’ll let you use your EIN or need to you personally guarantee the loan. The important thing to note is that the vehicle should be titled to your business to stand as a legitimate business deduction on your taxes.

[@eldacharm8547]

Thank you for your helpful videos. I am wondering if you can make a video about lease vs purchase a car for tax deduction differences. I want to get a Tesla Model X. I have a S corp business in California with over $100K net profit last year. I drive about 20,000 miles / year, 80% of it is business use. I usually change car every 3-4 years. Should I purchase or lease?

[@MrCPA-ry8mv]

That’s a great question! I will work on making that video and will let you know as soon as it’s posted!

[@Podcastordietrying]

This video was very useful!

[@jbenitez22]

With the purchase route, does the vehicle need to be a NEW car? Or does it also work the same for a 2-3 year old vehicle, especially with the first year depreciation? Thanks

[@MrCPA-ry8mv]

Just NEW to you. A used car is allowed as long as you are purchasing it for the first time for your business.

[@apocalypse2941]

Over 6k gvrw you can write off 100 percent right?

[@MrCPA-ry8mv]

Correct but only up to $25k. There are other criteria for vehicles to be fully deductible.