Ok I'm going to be real plain with numbers because I want help. I pay $1,150 a month truck payment for 07 model high mileage wore out truck. My repair cost averages around $750 monthly with me doing most work myself. Last year I grossed $142,000 running locally.
Now tax time is here. I owe $12,000 total for state and federal taxes.
My friend bought a brand new Peterbilt last year. He payed $170,000 for it. His monthly payment is $2,800. This year he got money back instead of paying and the tax man told him next year he should owe very little.
In essence, I average out to $2,900 monthly to drive a beater. How is driving an old truck cheaper? The tax man says if I run this truck another year and pay it off taxes will be outrageous.
My two concerns about buying brand new are, how much of a down payment do I need? And how much sales tax will I pay when I go to register it?
Other than those two points, I don't see any reason not to buy brand new. Or am I missing something?
Need Truck Buying Advice
Discussion in 'Ask An Owner Operator' started by OldeSkool, Mar 25, 2020.
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If you are deducting the crap that you are dumping into the beater truck in parts, cost etc against your taxes then that would be one thing.
I don't know if you can deduct the truck payment against taxes. I don't think that high. But since its a business expense...
I for one prefer to have a vehicle paid off. And on the other hand a older vehicle in which you know exactly whats matta with it and its history is like a good wife. You don't want to give that up.Keithdabarber, gerardo1961, stillwurkin and 1 other person Thank this. -
One question:
Why are you paying $1,150 for a 2007?
I'm paying $995.34 for a 2013 in GREAT condition. You got screwed from the get-go.Keithdabarber, PE_T, Blackhorse77 and 5 others Thank this. -
Curious to know how many miles you run weekly doing local work. You maintenance cost are close to mine but my truck is a 96 with no payment. How much do you owe on the 07?
I would expect 15-20% down on a new truck purchase with great business credit. Have you reached out to your bank or lender on the specifics?stillwurkin and x1Heavy Thank this. -
You can only deduct interest on the truck loan. Not the principle.
The reason he's getting money back is depreciation.
If you make enough to pay out a lot in taxes. I'd find a better tax man and accountant. Good ones know how to keep taxes down and still benefit you in some way.
In Ohio, they exempt you from sales tax with a PUCO, or MC number.
If you like the truck, besides fixing it, keep it. I drive an 01 387 because that's what truck I wanted. I don't mind fixing things. It's a business, you gotta spend money to make money.
If things would go way south and you'd have to sit next year. Would you rather have a paid off of truck, or try and come up with 2 grand for a payment?
That's just how I look at things.Keithdabarber, PE_T, x1Heavy and 5 others Thank this. -
brsims Thanks this.
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Do you pay yourself a salary, weekly or bi-weakly?
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