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NaturalBeam 
LSU Fan
Member since Sep 2007
12302 posts
| Buying a car under my business (Posted on 11/8/12 at 4:46 pm)
So I have a "business" - no legal filings, but I do have a business bank account, card, and checks with my business name on it. It's for no other purpose than to keep track of my business expenses more easily.
I'm about to buy my wife a new car - Will I have any problems buying it under the business? Just pay it out of that account for documentation?
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bryso 
Clemson Fan
The Real Death Valley
Member since Dec 2006
26768 posts
| re: Buying a car under my business (Posted on 11/8/12 at 4:51 pm to NaturalBeam)
how did you get a business bank account without filing with the SOS.
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NaturalBeam
LSU Fan
Member since Sep 2007
12302 posts
| re: Buying a car under my business (Posted on 11/8/12 at 4:56 pm to bryso)
Just opened one with Chase entitled "NaturalBeam, Attorney at Law". Showed a business card, and boom.
Also saved me $5 on my Sam's membership 
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bryso
Clemson Fan
The Real Death Valley
Member since Dec 2006
26768 posts
| re: Buying a car under my business (Posted on 11/8/12 at 5:03 pm to NaturalBeam)
how are u paid? independent contractor? i assume u get a 1099 at the end of the year?
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NaturalBeam
LSU Fan
Member since Sep 2007
12302 posts
| re: Buying a car under my business (Posted on 11/8/12 at 5:08 pm to bryso)
Yes and yes
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bryso
Clemson Fan
The Real Death Valley
Member since Dec 2006
26768 posts
| re: Buying a car under my business (Posted on 11/8/12 at 5:13 pm to NaturalBeam)
man this is going to be a tough one to swing
would likely set off a flag... if i were u i would incorporate as an S corp and then make ur wife an employee...
its one thing to write off your miles or maintenance whichever u pick. but its a totally different thing to write off a whole car that is driven by someone other than u.
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NaturalBeam
LSU Fan
Member since Sep 2007
12302 posts
| re: Buying a car under my business (Posted on 11/8/12 at 5:20 pm to bryso)
Ha that's what I was afraid of. Just didn't know the likelihood of getting flagged for something like that. Thanks.
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bryso
Clemson Fan
The Real Death Valley
Member since Dec 2006
26768 posts
| re: Buying a car under my business (Posted on 11/8/12 at 5:23 pm to NaturalBeam)
i'm not a CPA...so i could be 100% wrong... but i am 1099 as well... dont have a separate bank account..i just use mint to track my expenses and then take the itemized deductions where turbotax tells me.... i dont remember running across a "s/o automobile deduction"
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Tigah in the ATL
LSU Fan
Atlanta
Member since Feb 2005
20589 posts
| re: Buying a car under my business (Posted on 11/9/12 at 1:50 am to NaturalBeam)
Beyond the ethical thing (apparently not a problem), people with businesses buy shite for their family all the time. She just needs to be on the payroll & you need to be ready to shows its business use.
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bryso
Clemson Fan
The Real Death Valley
Member since Dec 2006
26768 posts
| re: Buying a car under my business (Posted on 11/9/12 at 8:42 am to Tigah in the ATL)
quote:
ethical thing (
i mean if its allowed by the IRS i dont really see where ethics comes into play.
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VABuckeye 
Ohio State Fan
Oak Hill, VA
Member since Dec 2007
8115 posts
| re: Buying a car under my business (Posted on 11/9/12 at 8:47 am to bryso)
quote:
i mean if its allowed by the IRS i dont really see where ethics comes into play
If being the operative word. He wants to buy a car for his wifes personal use under a business that doesn't really operate as a business. It just catches expenses.
No, nothing shady at all here.
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Poodlebrain
LSU Fan
Way Right of Rex
Member since Jan 2004
12655 posts
| re: Buying a car under my business (Posted on 11/9/12 at 8:59 am to bryso)
quote:
i mean if its allowed by the IRS i dont really see where ethics comes into play.
It is not allowed. A taxpayer is entitled to deduct expenses for the business use of an automobile. The OP stated that the business use would be zero since the car is for his wife to use.
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SAL MINIO
Davidson Fan
17th Street Canal
Member since Sep 2006
1776 posts
| re: Buying a car under my business (Posted on 11/9/12 at 10:09 am to Poodlebrain)
What if you have an LLC and own a building that you rent out, what can you write off? Should I start a new thread for this?
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Tenforty1728
LSU Fan
Baton Rouge
Member since Oct 2012
46 posts
| re: Buying a car under my business (Posted on 11/9/12 at 10:17 am to SAL MINIO)
Regardless of the business that an automobile is being used for, 100% is never really a good idea to write-off. Hard to argue any car is used 100% for business unless you have another car available for personal use.
Whether it's a rental property or any other self-employed activity, mileage or actual expenses can be taken, whichever is greater. The mileage rate is $.55 as of now. It moves with gas prices and inflation (it's only been going up). Actual expenses should apply a business use percentage to expenses. So if you pay $1,000 a year for auto insurance and use the car 80% for business use, your auto insurance write-off is $800.
That is the right way to do it rather than just paying all expenses out of the business. You can make adjustments at year end so all of it isn't expensed as another alternative.
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bryso
Clemson Fan
The Real Death Valley
Member since Dec 2006
26768 posts
| re: Buying a car under my business (Posted on 11/9/12 at 10:28 am to SAL MINIO)
quote:
What if you have an LLC and own a building that you rent out, what can you write off? Should I start a new thread for this?
writing off the car purchase is going to be tough... but mileage after that shouldn't be an issue.
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bryso
Clemson Fan
The Real Death Valley
Member since Dec 2006
26768 posts
| re: Buying a car under my business (Posted on 11/9/12 at 10:30 am to VABuckeye)
quote:
a business that doesn't really operate as a business.
when you're an indy contractor the govt lets you do things a little differently than the standard person....
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Chad504boy 
New Orleans Saints Fan
Five Oh Four
Member since Feb 2005
64692 posts
| re: Buying a car under my business (Posted on 11/9/12 at 10:37 am to NaturalBeam)
quote:
NaturalBeam
so when your wife is in an accident, just be prepared to have your company brought into the lawsuit.
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bryso
Clemson Fan
The Real Death Valley
Member since Dec 2006
26768 posts
| re: Buying a car under my business (Posted on 11/9/12 at 10:40 am to Chad504boy)
quote:
company
is used loosely here....
basically he has a separate checking account to make it easier to track how many paperclips he buys....
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Chad504boy
New Orleans Saints Fan
Five Oh Four
Member since Feb 2005
64692 posts
| re: Buying a car under my business (Posted on 11/9/12 at 10:41 am to bryso)
quote:
is used loosely here....
basically he has a separate checking account to make it easier to track how many paperclips he buys....
soo......... that extra account in a fake business name would be in jeopardy.
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GoHoGsGo06 
Stanford Fan
Member since Nov 2006
4040 posts
| re: Buying a car under my business (Posted on 11/9/12 at 11:28 am to Chad504boy)
quote:
so when your wife is in an accident, just be prepared to have your company brought into the lawsuit.
This.
Are you buying it outright, or with a car loan? If doing a car loan, bank will probably want some collateral securing that loan.
My opinion: You need to legally setup your "business" first. Do an LLP or something to protect yourself for when your wife wrecks your car; which will happen inevitably.
This post was edited on 11/9 at 11:30 am
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