ajag

I've always wondered how people write-off luxury/sports car leases. I have a buddy who TRAC leases all his sports cars through his business, has the bank set the buyout super low with high payments, and then purchases the car and sells it at the end of the lease. I just don't see how doing this won't get the IRS on you considering no one needs an exotic sports car to run a medical business.

80s

In sweden if your company owns the car theres a deduction from
Salary net ca 11k (gt3 i think) dollar per month its used, tax benefit of the car.
How does it work in us, is there a tax for letting the company have the car.
If you have a tax benefit and pay it, the irs should care less whether you daily drive a 918 or any other car

mass27

Same principle as people who speed. You are fine till you get caught. People (technically their CPA) will write off whatever they think they can get away with.

The vast majority of people don't understand tax law or how the IRS works. Their CPAs aren't typically giving sound advice as well.

rosenbergendo

Its all fine until the man shows up at your door. Then all these write offs became a major issue!

mwar99

+1

If they were audited most likely it would get denied as a proper deduction and you would be paying penalties and interest on a tax deficiency. It just depends on your risk tolerance. Will you get audited? Maybe, maybe not.

speeddistrict

1.99% for 6 years.. free money.. literally.

Mr. Adair

SMART.

Rxpert

Okay that makes sense to me now, it's a personal decision regarding risk tolerance.

Too intense for my blood......

Rxpert

I'd disagree. If interest rates are 1.99% or heck even 3-4%, you could take that same $150,000 and invest it fairly easily to make more $$$.

A business friend told me years ago when I was starting out that "Cash is King, always has and always will be." Couldn't be more true. You never know what opportunity the future may bring where you need six figures cash. Buying something outright simply to save on interest (when interest is at an all time low) seems silly.

Unless of course six figures is pocket change. But even if it is for some people they could make that money work for them better than to just save interest.

My vote is finance or lease and use your cash to make more money. Or hold it for whatever opportunities the future may bring.

br911

With short rates quite low, anything with potential returns > 1.99%, or, as a matter of fact > US T Bill returns, is associated to some level of risk. How much? It depends on how much more one wants to earn. But nothing is easy, and most of us do not have the same investment opportunities that the banks that finance/lease to us. Ex-post one can get lucky, but ex-ante there is no free lunch.

Judd Brown Msw

Who is offering that rate for six years?

Alan Smithee

Not true. There are no IRS rules or limitations as to what brands or types of cars are eligible or ineligible for corporate lease writeoffs.

carbonbmw

Who is offering 1.99% for 6 years?? Thanks

Nick

You sure about that?

timwu12

yes, i'd like to know this as well