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govt. subsidized gas-guzzlers

Discussion in 'Issues Around the World' started by martissimo, Jan 17, 2003.

  1. martissimo

    martissimo Veteran Member

    Absolutely bizarre, get one before congress closes this loophole if you are a small biz owner! ;)

    http://www.msnbc.com/local/pisea/104601.asp?0cv=CB20

    50,000 dollar vehicle, take a tax write off of 38k, decrease you income tax by about 15k after the write off, and you basically end up paid 3k dollars for buying the thing!
     
  2. tke711

    tke711 Oink Oink Staff Member

    I think that this is an important quote from the article and needs to be stated:

    Another important one:
    Remember, a deduction does not end up being a 1:1 cash equivalent. So, the $50,000 vehicle, minus the actual savings in income tax of $15,000 equals paying $35,000 for the vehicle. Not $3K like was stated before. You don't get to subtract the deduction AND the actual savings from the cost of the vehicle to figure actual cost to the owner.
     
  3. tke711

    tke711 Oink Oink Staff Member

    Sorry martissimo, I didn't see you stated "small biz owner" in you post. Otherwise, I wouldn't have put my first quote.
     
  4. martissimo

    martissimo Veteran Member

    woops, yes you are correct of course about the toal cost of the purchase, don't know what i was thinking there...

    as to the 50% usage thing, i really have to wonder how many people taking this deduction bother to even track their usage to make sure they fulfill it. i know i wouldn't feel right taking such a deduction without being very sure to meet the requirements of it, but expecting that most people do so seems a bit optimistic ;)
     
  5. Biker

    Biker Administrator Staff Member

    It depends on the business. If your job requires you to be sitting at a desk the majority of the day, doubtful you'd get away with the deduction. However, for those that spend a good deal of the day driving for the business (deliveries, sales calls, trouble calls, etc.), then the deduction is valid.
     
  6. tke711

    tke711 Oink Oink Staff Member

    LOL...more like INCREDIBLY optimistic.

    However, if they are lying, they better hope they never get audited and are asked to prove it. :)
     
  7. ethics

    ethics Pomp-Dumpster Staff Member

    Many people I know have been using something similar to this loophole. Of course, this example is a LOT of dough. :)

    Thanks for the thread. :)
     

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