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13 September 2017, 10:26 PM | #1 |
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My Dream Situation
I just had a long talk with my accountant. This gentleman has been with my company for well over a decade.
There are things that I do not like about him. However, he is squeaky clean and I feel very confident with him. I know that I leave money on the table, but I prefer to not take any chances. I have had other accountants tell me I could play with some loopholes a bit more, and I always decline. I like to play it safe with taxes. Now that this is out of the way. As some may remember, I recently leased two F150's and branded them as a way of advertising and transporting staff and tools and materials. I knew that leasing was good for tax purposes, but I don't have much experience with leasing and I did not realize that this is basically a complete write off as it is a work tool. Further to that, I drive one of them pretty regularly. However, I also own my X5 outright. So my accountant tells me, knowing that I like to flip cars, that there might actually be a business case to trade in my X5 and lease a car for me. I never leased before because I put so many miles on my vehicles due to work. However, now that I split my time with the F150 and my own vehicle, I can get away with 15,000 a year for a lease. And apparently because I use it so much for work, that too is a nice write off, and becomes better when I lease a vehicle. So I can literally trade in my X5, get a nice big check and write off the cost of a new vehicle lease as long as it is over a certain weight. Now, I like my X5 a lot. But I am not sure I am going to pass up this opportunity. I do realize that I lose based on the hit from the X5, but I make up for that to some degree by having the extra cash to work with. And now I have a payment whereas before I did not. But much of the payment is a write off and this is just one payment amongst many. This is going to be fun. A lot of options to play with. Clearly, has to be an SUV. Not as interested in the fastest SUV I can get, as I was in the past. I am more interested in snow capable. I do want power, but I think armageddon is on the way, and I want to be prepared. I will update the thread later with some thoughts, but again, this is going to be fun. And I felt compelled to share.
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13 September 2017, 10:44 PM | #2 |
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Always fun to shop for a new car ... just realized I am making this statement to a car lover/flipper realize that if you lease you are kind of " stuck" with the car for the lease term ..... although I guess you can always get out of a lease too. Enjoy the search
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13 September 2017, 11:13 PM | #3 | |
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Quote:
And yeah, I was warned to ensure I get something I really like. I was told that getting out of the lease will not be ideal and that I'll need to commit to 39 months, which is an eternity.
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13 September 2017, 11:15 PM | #4 |
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I'm not an accountant but I believe it allows for any vehicle over 6000lbs. This came about from too many sports cars being written off. I may be inaccurate in the details but instead of leasing, you can also depreciate a much larger chunk of the truck if you choose to purchase.
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13 September 2017, 11:28 PM | #5 |
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Nice, new cars are always fun, especially when you're picking! I've been looking into picking up a Tahoe, if you want Armageddon ready take a look at the Z71.
What's the shortest term lease there is? Can't you do yearly?
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13 September 2017, 11:36 PM | #6 |
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" I am more interested in snow capable"...Subaru. Period.
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14 September 2017, 12:07 AM | #7 | |
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And I can take depreciation from the vehicle that I purchase. And I'm no expert, but I believe the tax benefits of a lease are far superior. Edit: adding that I think my accountant is trying to get me into a lease as it's cleaner for him, and he wants to lock me down into something I can't flip.
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14 September 2017, 12:10 AM | #8 |
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Thanks for the suggestions so far. Being that I'm going to be stuck if I actually do this, and that I'm a bit of a car nut, I'm likely going to find a mix of luxury, power and capability.
So far: Wrangler Rubicon Full size Range Rover Mercedes GLS 550 Chevy Tahoe Yukon Denali So far. So we shall see. I'm not in a rush, so I'm going to try and enjoy the process
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14 September 2017, 12:52 AM | #9 |
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If a full size Range Rover is in the cards that's the ticket no doubt about it.
Otherwise the new discovery diesel is really quite nice and gets killer range on the tank which is a huge plus imho. I assume the raptor takes a back seat given the f150 is already in the stable? Often overlooked is the Lexus LX570 imho. Go to the dealer and sit inside before you write it off. Very posh interior and super capable for Armageddon Edit: another idea which I think???is legal. I drive a 4Runner trd pro. I would only recommend one as a comp to a Jeep Wrangler as they drive like crap compared to all the other options you listed. You could lease one. Write off the payments. Buy it at lease end for the residual and likely have 10k in positive equity. Look up the resale.
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14 September 2017, 01:02 AM | #10 | |
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Seth - if you are looking at Tahoe or Denali go for an Escalade - lease is very aggressive. If you want numbers or info PM me and I'll take care of you on it.
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14 September 2017, 01:31 AM | #11 |
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A MB G65 is 6065 pounds.
May as well have style and performance. |
14 September 2017, 04:32 AM | #12 | |
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14 September 2017, 04:51 AM | #13 |
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Thanks for the suggestions guys.
So far, the GLS 550 is in the lead. Nice power, a lot of car for the money in comparison to the RR and it has an off-road package.
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14 September 2017, 06:59 AM | #14 |
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Whelp.
GLS 550 & full size Range are basically the same money. So it's a toss up. MB is silver with black package, RR is black on black. Touch call.
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14 September 2017, 07:17 AM | #15 |
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Rover or GLS. You can also do a prepaid lease so you have no payments and usually save a little on the lease factor.
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14 September 2017, 08:04 AM | #16 |
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BTW, your accountant can't tell you anything illegal or they can lose their license to practice. I'd follow your accountant suggestions.
What X5 you have? The 50 or the D? I'm trying to determine what my next car will be. Much more practical than yours of course? My mechanic is saying to get the X5D.
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14 September 2017, 08:07 AM | #17 |
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14 September 2017, 08:39 AM | #18 |
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Seth, you can also add miles to the lease upfront. Most leasing companies will do up to 25k per year.
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14 September 2017, 09:25 AM | #19 |
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Seth, this is going to be fun! Being that you are now a Mercedes fan with that gorgeous SL you have, I think the GLS 550 is the one to add. I am speaking from experience, I have one for my wife, in the same color combo you are looking at, Irridium Silver and Black interior. The technology in this think is amazing. The quality as usual is top notch. It is based on a S class platform after all. It is such a solid vehicle, with the space to accomodate seven people comfortably. I am very happy with this latest one, we have been buying the GL series for years, and this one currently is the real deal. I remember, when looking to get into a new seven passenger SUV, I ventured out and looked at the competition...one re confirmed this one, again was the residual on the lease. I think ours was 63%, insanely high, the competition couldnt come close. So for leasing, this was the one.....one other thing, ours has Apple car play and it is so intuitive to use, love it. Good luck
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14 September 2017, 09:27 AM | #20 |
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Here are some pics of the wife's hauler
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14 September 2017, 09:56 AM | #21 |
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You could get a new X5 I believe its over the 6000 MGW guide line whatever you get it needs to be a large SUV to meet the Weight limitation but you can lease a luxury car there is a minor lease add back at year end (I'm a CPA) I often advise my clients on these matters and I will also tell you I never advise people to incur debt for tax deductions.
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14 September 2017, 10:15 AM | #22 |
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This is a tough call. Both are baeutiful vehicles.
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14 September 2017, 10:28 AM | #23 | |
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And I probably should not do this. I might not. I like my car a lot. And it's not smart financially. Some value is there, but it's overall not responsible. I get it. But I continue to have this nagging thought that life is short, and this is fun. I've got my issues with watches and cars. But mostly, I'm annoyingly conservative and responsible. A little bit of balance in the grand scheme, I'm figuring. However, I'm looking at near to 45k back in cash, along with a 39 month lease. And the lease costs that are mostly a tax write off. You are right, I know you are. My CPA also ultimately agrees with you. At the same time, the math seems to work in my favor. While also violating the cardinal rule you mention. Tough call.
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14 September 2017, 10:32 AM | #24 | |
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14 September 2017, 10:38 AM | #25 | |
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But it's also not going to effect much in any discernible way. It's also things like this that have always motivated me.
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14 September 2017, 10:49 AM | #26 |
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Seth,I still see you in the RR SVR in the royal blue!
I think it can handle the snow. |
14 September 2017, 12:11 PM | #27 |
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G Wagon! Perfect blend of form and function.
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14 September 2017, 12:38 PM | #28 |
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This is fun to tag along for this "ride" no pun intended :) Always exciting when in the market for a new car.
My vote(s) would out of the cars mentioned so far would be G-Wagon, GLS, Porsche Cayenne Turbo, or maybe even Tesla Model X - all different higher end SUVs depending on what you like (also not sure if those are all >6000lbs). In either case - I recently started leasing my cars instead of owning them outright as I was changing them every 2-3 years anyway and I'm very happy with it. That being said - I had to get out of one of my car leases last year and it was not easy, thankfully I found someone trustworthy through Craigslist of all places and Mercedes-Benz allows for lease transfers, but I would emphasize that it was an extremely painful and stressful process (for me at least). That was the one time I wished I had just bought the car outright as unloading it would have been a hell of a lot easier. So my advice would be just choose a shorter term lease (if feasible) unless you are certain you'll be ok with the car for the lease term come hell or high water... Just my 2 cents. |
16 September 2017, 03:55 AM | #29 | |
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Looks good.
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16 September 2017, 08:10 AM | #30 |
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Many do offer 12 month leases.
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