Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
I bought a car in Nov 2012 and used it for ~50% business use for a partnership I was a member of. The partnership does not reimburse car expenses, so each partner writes off their own car expenses on their personal tax returns.
On 1/1/13, I left the partnership and started a single-member S corp. The S corp does reimburse shareholders' car expenses.
For 2012, I plan to use the actual expenses method to deduct my business car use on my 1040. I know that if I deduct actual car expenses method on my 2012 1040, I cannot deduct the standard mileage rate for subsequent years' 1040.
However, for 2013, is it permissible for me to get reimbursement from the S corp at the standard mileage rate?
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- Joined: Sun Jul 06, 2008 5:47 pm
I am not an accountant, but I was never able to deduct car expenses while having an s corp. Does the s corp own the car? I had considered buying a heavier truck/suv when one could deduct the whole cost in 1 year if it was primarily for business use and had over 6K pounds towing capacity. I chose not to do so, because I basically drove old cars. I don't know if the larger vehicle deduction is still available.
Several years ago my accountant told me the s corp could pay for mileage, but then I would have to add that onto my 1040 as income. It was a wash, so I just stopped keeping track of mileage, and stopped wasting any energy on this issue.
"Let us endeavor, so to live, that when we die, even the undertaker will be sorry." Mark Twain
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My S-corp owned a pickup truck that my biz-partner used to pick up parts which we depreciated - gas/maint was a corporate expense - I expensed my personal mileage at the IRS rate ( $.55/mile ) which was counted as a corp. expense.
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