2005 V8 4x4, gross weight of 6001lb
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Hitman
New member
fjc32 said:
Didn't they close that tax loophole? I had heard that too many people were taking advantage of it with Hummer H2's and Ford Excursions and such...
From what I remember, it was supposed to provide tax relief to farmers and people who honestly need big, heavy trucks to make thier living....
SUVs will still be allowed a first year write-off of up to $25,000
if used for business. The "auto deduction limitations" have been
around for more than 20 years and were originally enacted to
prevent people from claiming large deductions on high-dollar
luxury cars such as Rolls-Royces, Mercedes-Benzes, etc. SUVs
and trucks with gross vehicle weights in excess of 6,000lbs.
were excluded from the definition of a "passenger vehicle" at the
time and this distinction has not changed.
if used for business. The "auto deduction limitations" have been
around for more than 20 years and were originally enacted to
prevent people from claiming large deductions on high-dollar
luxury cars such as Rolls-Royces, Mercedes-Benzes, etc. SUVs
and trucks with gross vehicle weights in excess of 6,000lbs.
were excluded from the definition of a "passenger vehicle" at the
time and this distinction has not changed.
ToolmanJohn
New member
fjc32 said:
Weren't the 03-04 models about 4600-4800 lbs max??? How does it get to 6000 lbs? Is it gross weight OR is it tow capacity?
EDIT: NEVER mind, gross weight is the TOTAL weight INCLUDING payload in the vehicle. SO the truck plus people and cargo max is 6002 lbs. Heh, took me 1 minute to think of it after I posted.
I'm not an accountant. Consult a tax accountant before you do this.
First, make sure the specific one you are buying has the gross weight at over 6000 pounds as printed on the door jam. Only the V8/4WD versions do. But don't take any chances, make sure it's actually printed on the door jam of the vehicle you will be driving home. If it is over 6000 pounds, you may be entitiled to a deduction if:
(1) You use it for business more than 50% of the time. The rules here are tricky. If you don't actually use it for business, you probably won't be able to sneak by.
(2) If your income qualifies. Basically, you can't claim more than you made. The rules here are flexible, so you might be able to qualify.
(3) You buy and don't lease.
The $100,000 limit is still in effect, but only for a few more days. President Bush is expected to sign a new tax bill that would, among other things, put the limit back to $25,000. The new bill is expected to be signed this week. However, you may still be able to get most of it as a write off. Here's how:
Besides the $25,000 basic equipment deduction, SUVs still qualify for "bonus depreciation", an added write off of 30 percent of the purchase price above $25,000. Beyond that the regular depreciation rules of 20 percent in the first year will apply.
Using a 2005 Limited 4Runner V8/4WD that costs $40,000 out the door as an example, you should be able to write off $31,600 of the $40,000 sticker price in the first year under the revised rules. A $25,000 equipment deduction, $4,500 in bonus depreciation and $2,100 in regular depreciation.
Note though that this is if you use the vehicle 100% of the time for business. If you use it 80% of the time for business, for example, the deduction would be $25,280.
Look here: http://www.selfemployedweb.com/suv-tax-deduction-6.htm for some more information. I'm not an accountant. Consult a tax accountant before you do this.
First, make sure the specific one you are buying has the gross weight at over 6000 pounds as printed on the door jam. Only the V8/4WD versions do. But don't take any chances, make sure it's actually printed on the door jam of the vehicle you will be driving home. If it is over 6000 pounds, you may be entitiled to a deduction if:
(1) You use it for business more than 50% of the time. The rules here are tricky. If you don't actually use it for business, you probably won't be able to sneak by.
(2) If your income qualifies. Basically, you can't claim more than you made. The rules here are flexible, so you might be able to qualify.
(3) You buy and don't lease.
The $100,000 limit is still in effect, but only for a few more days. President Bush is expected to sign a new tax bill that would, among other things, put the limit back to $25,000. The new bill is expected to be signed this week. However, you may still be able to get most of it as a write off. Here's how:
Besides the $25,000 basic equipment deduction, SUVs still qualify for "bonus depreciation", an added write off of 30 percent of the purchase price above $25,000. Beyond that the regular depreciation rules of 20 percent in the first year will apply.
Using a 2005 Limited 4Runner V8/4WD that costs $40,000 out the door as an example, you should be able to write off $31,600 of the $40,000 sticker price in the first year under the revised rules. A $25,000 equipment deduction, $4,500 in bonus depreciation and $2,100 in regular depreciation.
Note though that this is if you use the vehicle 100% of the time for business. If you use it 80% of the time for business, for example, the deduction would be $25,280.
Look here: http://www.selfemployedweb.com/suv-tax-deduction-6.htm for some more information. I'm not an accountant. Consult a tax accountant before you do this.
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This law was origionally put in for farmers with heavy equipment. In mid 90's when the SUV market exploded, accountants started using this law for their clients. First of all if you own a business, you can and accountants will, use the purchase of the vehicle for a tax writeoff with this "loophole". There is nothing illegal about it. Also, about qualifing business....any business can qualify. Heck if you own a computer store and you have a SUV that you use to commute withand it fits this category you can write it off. Yes car dealers use this law too. I have a friend who is a CPA and he said that it is common practice. He also said that he would have to check, but he said if he isn't mistaken that you can use this deduction for each vehicle purchased for use in the business. But like Faeylyn said, do your own research to verify.
BTW...my parents justed used this law for a tax write off last year.
BTW...my parents justed used this law for a tax write off last year.
Yes, you can use this for every vehicle purchased for your businees where the vehicle is used more than 50% for the business. The key is that the vehicle must be used for more than 50% for the business.
Owning a company where your only office is an office outside of your home and using the vehicle to commute back and forth to the office DOES NOT QUALIFY. That mileage is personal mileage, not business mileage. If you have a CPA that tells you differently, get another CPA.
However, if you also have and claim a REAL home office in addition to an outside office, the trip between home office and an office outside the home should qualify. Keep in mind you can claim anything you want to claim on your tax return. But when Joe IRS comes knocking, you want to make sure you send him away without any more of your money.
It can be tricky to qualify. See a tax accountant BEFORE you purchase a vechicle if you are thinking of doing this.
Owning a company where your only office is an office outside of your home and using the vehicle to commute back and forth to the office DOES NOT QUALIFY. That mileage is personal mileage, not business mileage. If you have a CPA that tells you differently, get another CPA.
However, if you also have and claim a REAL home office in addition to an outside office, the trip between home office and an office outside the home should qualify. Keep in mind you can claim anything you want to claim on your tax return. But when Joe IRS comes knocking, you want to make sure you send him away without any more of your money.
It can be tricky to qualify. See a tax accountant BEFORE you purchase a vechicle if you are thinking of doing this.
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ToolmanJohn
New member
Read my earlier reply
GROSS weight is the vehicle plus payload. If they state max gross of 6001 lbs, it's vehicle PLUS cargo (inside cargo). Therefore it won't qualify if the minumum is 6000lbs.
There is CURB weight (the truck ITSELF) and gross weight. The tax loophole is for the curb weight. The two often get confused.
Here's the specs on the 2005's
http://www.toyota.com/vehicles/2005/4runner/specs.html
Faeylyn said:
GROSS weight is the vehicle plus payload. If they state max gross of 6001 lbs, it's vehicle PLUS cargo (inside cargo). Therefore it won't qualify if the minumum is 6000lbs.
There is CURB weight (the truck ITSELF) and gross weight. The tax loophole is for the curb weight. The two often get confused.
Here's the specs on the 2005's
http://www.toyota.com/vehicles/2005/4runner/specs.html
ToolmanJohn
New member
Well then...
Just load the hell out of a Subaru Forester, make it just over 6000 pounds then, get the tax deduction for it, right??? That's gross weight, not curb weight. As I stated before, the gross weight gets plenty confused with curb weight. They two terms can't be used interchangably. I'm sure the IRS only cares about the weight of the vehicle itself, not how much you can stuff in it.
Try getting a deduction on your family sedan. It would be easy to do, air the tires up like crazy, then just put a bunch of cement bags into the trunk and rear seat, and don't forget the passenger side too. If it's still not heavy enough, get a roof rack and load up the top too. Claim you deduction for your 6000+ pound Camry. IRS will go for it.........
Had to add this, if the vehicle does NOT weigh over 6000 pounds, empty, without driver, it can't qualify. Only a loaded 4runner V8 will barely make it when loaded to Toyota's stated GVWR. (1450 lbs of payload).
Faeylyn said:
Just load the hell out of a Subaru Forester, make it just over 6000 pounds then, get the tax deduction for it, right??? That's gross weight, not curb weight. As I stated before, the gross weight gets plenty confused with curb weight. They two terms can't be used interchangably. I'm sure the IRS only cares about the weight of the vehicle itself, not how much you can stuff in it.
Try getting a deduction on your family sedan. It would be easy to do, air the tires up like crazy, then just put a bunch of cement bags into the trunk and rear seat, and don't forget the passenger side too. If it's still not heavy enough, get a roof rack and load up the top too. Claim you deduction for your 6000+ pound Camry. IRS will go for it.........
Had to add this, if the vehicle does NOT weigh over 6000 pounds, empty, without driver, it can't qualify. Only a loaded 4runner V8 will barely make it when loaded to Toyota's stated GVWR. (1450 lbs of payload).
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Hitman
New member
I have to agree that it is the gross weight that must be 6000 pounds.
You can't simply overload a Camry or a Forester to meet the 6000 pound requirement. The vehicle has to be listed as 6000 pounds gross, meaning the weight of the vehicle itself plus the payload that it is capable of carrying, according to the manufacturer.
You can't simply overload a Camry or a Forester to meet the 6000 pound requirement. The vehicle has to be listed as 6000 pounds gross, meaning the weight of the vehicle itself plus the payload that it is capable of carrying, according to the manufacturer.
Hitman
New member
This should clear it up:
http://www.bankrate.com/brm/itax/biz_tips/20030403b1.asp
Vehicles that qualify for generous tax break
By Bankrate.com
Want a company car that Uncle Sam will let you write off for the most part? Then consider one of these vehicles as your main mode of business transport.
To qualify for the deduction (Section 179 of the tax code), an SUV or light truck must have a gross weight of at least 6,000 pounds. This is the vehicle weight plus maximum payload and also is referred to as gross vehicle weight rating or GVWR. Before buying any vehicle for your business, always verify the GVWR for yourself. It usually is found on a label attached to the inside edge of the driver's side door.
BMW X5
Ford F150 Styleside 4WD
Cadillac Escalade ESV
Ford F250 Super Duty Super Cab
Chevrolet Astro Passenger Van AWD
Ford F350 Super Duty DRW Super Cab
Chevrolet Avalanche 2500
GMC Safari AWD Passenger Van
Chevrolet Express Passenger Van 3500
GMC Savana Passenger Van 3500
Chevrolet Silverado 3500
GMC Sierra 350 &
Sierra Denali
Chevrolet Suburban 2500
GMC Yukon XL
Chevrolet Tahoe
Hummer H1 & H2
Chevrolet Trailblazer
Land Rover Discovery
Dodge Durango
Land Rover
Range Rover
Dodge Ram Cargo Van 3500
Lincoln Navigator
Dodge Ram
MaxiVan 3500
Lincoln Blackwood
Dodge Ram Wagon
Mercedes M Class
320 and 500
Dodge Ram 1500
Mercedes ML55 AMG
Dodge Ram 2500 & 3500 two-door Porsche Cayenne,
S and Turbo
Ford Econoline
E350 Van
Toyota Land Cruiser
Ford Econoline E350 Passenger Wagon
Toyota Sequoia 4WD
Ford Econoline
E-150, E-250
and E-350
Toyota Tundra 4WD Access Cab
Ford Excursion
Volkswagen Touareg
Ford Expedition Volvo XC90 (optional third row seating)
http://www.bankrate.com/brm/itax/biz_tips/20030403b1.asp
Vehicles that qualify for generous tax break
By Bankrate.com
Want a company car that Uncle Sam will let you write off for the most part? Then consider one of these vehicles as your main mode of business transport.
To qualify for the deduction (Section 179 of the tax code), an SUV or light truck must have a gross weight of at least 6,000 pounds. This is the vehicle weight plus maximum payload and also is referred to as gross vehicle weight rating or GVWR. Before buying any vehicle for your business, always verify the GVWR for yourself. It usually is found on a label attached to the inside edge of the driver's side door.
BMW X5
Ford F150 Styleside 4WD
Cadillac Escalade ESV
Ford F250 Super Duty Super Cab
Chevrolet Astro Passenger Van AWD
Ford F350 Super Duty DRW Super Cab
Chevrolet Avalanche 2500
GMC Safari AWD Passenger Van
Chevrolet Express Passenger Van 3500
GMC Savana Passenger Van 3500
Chevrolet Silverado 3500
GMC Sierra 350 &
Sierra Denali
Chevrolet Suburban 2500
GMC Yukon XL
Chevrolet Tahoe
Hummer H1 & H2
Chevrolet Trailblazer
Land Rover Discovery
Dodge Durango
Land Rover
Range Rover
Dodge Ram Cargo Van 3500
Lincoln Navigator
Dodge Ram
MaxiVan 3500
Lincoln Blackwood
Dodge Ram Wagon
Mercedes M Class
320 and 500
Dodge Ram 1500
Mercedes ML55 AMG
Dodge Ram 2500 & 3500 two-door Porsche Cayenne,
S and Turbo
Ford Econoline
E350 Van
Toyota Land Cruiser
Ford Econoline E350 Passenger Wagon
Toyota Sequoia 4WD
Ford Econoline
E-150, E-250
and E-350
Toyota Tundra 4WD Access Cab
Ford Excursion
Volkswagen Touareg
Ford Expedition Volvo XC90 (optional third row seating)
Hitman is correct. It is the manufacturer specified gross vehicle weight. The Toyota-specified gross vehicle weight (the vehicle weight plus maximum payload) of a 2005 4Runner 4x4 V8 is 6005 according to Toyota's website. That's the maximum payload Toyota thinks you should carry - not the maximum you could stuff in there if you were really motivated.
Most of the vehicles on the list provided by Hitman have a curb weight of less than 6000 pounds, including the Sequoia, Land Cruiser, and Tundra. Yet all have a GVWR of over 6000 pounds.
BTW, the list above is not exhaustive. If the vehicle is listed by the manufacturer as having a GVWR of over 6000 pounds, it qualifies. As I said earlier though, make sure the sticker on the door agrees with that number.
Most of the vehicles on the list provided by Hitman have a curb weight of less than 6000 pounds, including the Sequoia, Land Cruiser, and Tundra. Yet all have a GVWR of over 6000 pounds.
BTW, the list above is not exhaustive. If the vehicle is listed by the manufacturer as having a GVWR of over 6000 pounds, it qualifies. As I said earlier though, make sure the sticker on the door agrees with that number.
ToolmanJohn
New member
Thanks HitMan
You guys are right.
I really thought it was just the weight of the vehicle. I have several friends who have taken that deduction for their business vehicles, but their trucks are all pigs, well over 6000 pounds by themselves, and they also said that their vehicles had to be over 6000 pounds.
So the IRS must have a list of vehicles from each manufacturer, in order to keep it "real"? Else you could make your own door jamb sticker for any car.
You guys are right.
I really thought it was just the weight of the vehicle. I have several friends who have taken that deduction for their business vehicles, but their trucks are all pigs, well over 6000 pounds by themselves, and they also said that their vehicles had to be over 6000 pounds.
So the IRS must have a list of vehicles from each manufacturer, in order to keep it "real"? Else you could make your own door jamb sticker for any car.
The purpose of checking the sticker is to double-check that the exact vehicle you are intersted in is over 6000 pounds before you sign on the dotted line. Since some 2005 4Runner models come in under 6000 pounds, you don't want to be surprised.
Same thing with the Tundra (only the V8 model is over 6000 pounds). The Sequoia and Land Cruiser on the other hand have all models above 6000 pounds GVWR.
Same thing with the Tundra (only the V8 model is over 6000 pounds). The Sequoia and Land Cruiser on the other hand have all models above 6000 pounds GVWR.
Faeylyn said:
Once again I state that this law was origionally written for FARMERS. Since being on a farm means you need to drive into town to get your seed, groceries, repair items and the like, ALL and I mean ALL milage IS tax deductable. You can contact any reputable accountant and they will tell you this. Now, since accountants are using this "loophole" for SUV vehicles for people that own thier own business it gets into a grey area. I could for example take out a friend to dinner. Say I am a stockbroker......as long as I just mention my home business, cha-ching....tax write off. Meal and milage because he just became a potiental client. There are so many ways to get around the 50% thing you mentioned. That is why any and I mean any CPA or person doing their own taxes can put it down as a write-off and the the IRS can do all the checking they want, but will find no fault. Just make sure you own your own business or the company you work for neccessitates the job you have requires it.
I'm really not trying to be argumentative here. I just want to make sure that people get precise information. Otherwise they could really get screwed up come April 15th.
1. The law was not originally meant for farmers. Farmers, yes. But also any job where you actually need and use the truck, such as most construction jobs, landscaping, etc.
2. It doesn't really matter what it was originally meant for. It's perfectly legal to take the deduction if you use the vehicle for business purposes. A lot of people call this a loophole and it isn't.
3. Regardless of whether you are a farmer, construction worker, banker, lawyer, doctor, or anything else, the deduction is based on the percentage the vehicle is used for work vs. personal use. This is obviously easier for some professions to justify than others.
4. A doctor, laywer, etc., without a home office CANNOT legally count the mileage from home to the office, work-site, whatever. A farmer using a work truck to go to town for personal reasons only (groceries, whatever) CANNOT legally count that mileage. If the farmer does business while in town, fine. If not, the trip cannot be counted.
5. You can CLAIM whatever you think you can get away with. However, if you don't have records to back up your claim and you get audited, good luck and hope you end up somewhere that has internet access so you can keep up with toyota-4runner.org. However, a farmer or construction worker is much less likely to be questioned over a work vehicle than a doctor or lawyer, etc. In fact, they would probably never be questioned about it.
6. Again and again, commute from home (not a home office) to an office or work site CANNOT be legally counted. Be very careful here, don't play around with the IRS, and make sure you keep excellent records.
7. Above all, ask your own CPA. Don't listen to anyone on this board, myself included, or you might get a visit from a certain uncle. :monster:
1. The law was not originally meant for farmers. Farmers, yes. But also any job where you actually need and use the truck, such as most construction jobs, landscaping, etc.
2. It doesn't really matter what it was originally meant for. It's perfectly legal to take the deduction if you use the vehicle for business purposes. A lot of people call this a loophole and it isn't.
3. Regardless of whether you are a farmer, construction worker, banker, lawyer, doctor, or anything else, the deduction is based on the percentage the vehicle is used for work vs. personal use. This is obviously easier for some professions to justify than others.
4. A doctor, laywer, etc., without a home office CANNOT legally count the mileage from home to the office, work-site, whatever. A farmer using a work truck to go to town for personal reasons only (groceries, whatever) CANNOT legally count that mileage. If the farmer does business while in town, fine. If not, the trip cannot be counted.
5. You can CLAIM whatever you think you can get away with. However, if you don't have records to back up your claim and you get audited, good luck and hope you end up somewhere that has internet access so you can keep up with toyota-4runner.org. However, a farmer or construction worker is much less likely to be questioned over a work vehicle than a doctor or lawyer, etc. In fact, they would probably never be questioned about it.
6. Again and again, commute from home (not a home office) to an office or work site CANNOT be legally counted. Be very careful here, don't play around with the IRS, and make sure you keep excellent records.
7. Above all, ask your own CPA. Don't listen to anyone on this board, myself included, or you might get a visit from a certain uncle. :monster:
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