Getting a G-Wagon for 50% Off Using the Tax Code?

true or false factor cap can you use the u.s tax code to get a g wagon for 50 off and in order to test this myself i bought a g-wagon what's going on youtube this is editing tom from the future while editing this video i realized i made a major jump i forgot to lay a proper foundation section 179 of the tax code which i'm about to start talking about past tom is about to start talking about is for business owners so if you do not own a business you cannot even think about taking these deductions also i'm not your lawyer this is not tax advice all right back to future tom back to past tom that's in a g wagon key section 179 what is section 179 section 179 is for first year purposes writing off equipment that you bought in the first year that you bought the equipment now what is equipment equipment's a very loose term as defined by the irs equipment could be a forklift if you were in the construction business or it could be a car but not all cars are treated the same if your vehicle weighs above 6 000 pounds but below 14 000 pounds the vehicle qualifies as a heavy duty vehicle under section 179 and is therefore subject to exemptions and coincidentally the g wagon falls into that category under section 179 you can potentially deduct up to one million forty thousand dollars of equipment and as you might guess a g wagon doesn't cost that much so in theory you could deduct the entire thing or so it sounds but it's not that easy first we have to understand how depreciation is normally handled let's say i buy a million dollar piece of equipment and the lifespan for that equipment is 10 years well under normal depreciation principles i would depreciate that piece of equipment a hundred thousand dollars every single year until the year 10 in which all 100 million all one million dollars would be depreciated million dollar piece of equipment 10 year life span you pro rata depreciate that asset down before i begin i am shamelessly asking you to hit that like button every time you hit the like button it pushes the video out on the youtube algorithm so more people view it and our community can continue to grow we just passed 195 000 people and it is very very heartwarming and i really appreciate it as always my goal is to make content worthy of your time so what makes section 179 different well essentially under section 179 you're capitalizing the entire asset and putting it on your balance sheet meaning your company has less in profits because they are writing off or deducting that entire expense what type of property qualifies for the 175 deduction and i'm going to break eye contact with you because i'm about to read a list so sorry about that sue me it's automobiles computers machinery and equipment office equipment office furniture signs if the sign is movable tractors and trucks and there are a whole bunch of conditions you need to satisfy as well i'm not going to get into all of them the most important one for the purposes of this video because we are talking about a car a g-wagon is use in order to take a section 179 deduction you need to use that piece of equipment in this case the car at least 50 of the time or greater for business purposes so i can't just go out buy a g-wagon for my law firm and then never actually use it for law firm purposes now like i said earlier in the video there is a limit to how much you can depreciate off of 179 in 2020 that number was just above 1 million and yes while you do have to use the vehicle for 50 or more the time to qualify for section 179 that doesn't mean you're necessarily out of the woods you take the amount of time you use the vehicle for business purposes and you apply that pro rata to the tax deduction let me give you an illustration of that let's say the g wagon cost a hundred thousand dollars and i used it 100 of the time for my business i never used it as a personal car well in that case i can write off all one hundred thousand dollars of it in my tax deduction but let's say i use the g wagon only sixty percent of the time for business and forty percent of the time for personal fun well in that scenario i can only deduct sixty thousand dollars or sixty percent so let's dissect the original claim can you use the tax code to essentially get a g wagon for fifty percent off well not really at best at best 40 off right because that's generally the highest tax bracket so if you depreciate the entire vehicle off of your taxes you're essentially saving 40 on your money so it's really closer to 40 but as i just explained it's really more complicated than that if you're buying a g wagon or a heavy suv you're probably going to be using it for some personal purposes and the last thing you want to do is lie on your taxes and get in trouble but there is a reason why business owners are buying suvs over six thousand pounds and on top of that there's a reason why that a lot of automakers are literally making their vehicles six thousand and one pounds if you don't believe me look it up there's a whole bunch of vehicles that i'm gonna put right here that qualify for the 179 heavy vehicle deduction all right back to g wagon tom this is in my car this is my friend's car i came to his house so he could let me film in it if you know me i don't really care about cars and i probably couldn't afford a g-wagon anyway that's it for today's video please make sure you leave any comments concerns questions down below in the comments section make sure you hit that like button and subscribe to this channel if you want to join this community we're growing like crazy i really appreciate the support y'all i'll talk to you later thanks for watching

Channel: AttorneyTom

Views: 46,261

Keywords: law, lawyer, attorney, AttorneyTom, Personal Injury, Personal Injury Lawyer, Personal Injury attorney, lawyer reacts, personal injury court, reacts, attorney reacts, accident lawyer, money, real estate, personal finance, legal, G WAGON, section 179, 179 deduction, taxes 2021, taxes for small business, cars, business credit, business ideas, taxes, g wagon post malone, g wagon 2021, g wagon off road, g wagon 6x6, g wagon 2020

Id: DdZ4oAFttck

Length: 6min 5sec (365 seconds)

Published: Mon Mar 22 2021