Depreciating Truck

You can write off the amount it depreciated per year. I'm sure the irs has a depreciation schedule...

So if you buy a 100,000 truck and 1 year in it is worth 80,000
You write off 20,000...

Now if you went and sold the truck somehow for say 120,000, it is on the books now as an 80,000 asset, so you would show a profit of 40,000 on the sale..

It takes a bit to wrap your head around, but once you get it it makes sense.. You can also write off the interest amount if you are making payments on your truck.

 

Look it up on YouTube. I used turbo tax to do it. You work with an account ant and you can decide how much you can write off. Meaning you can write off more the first year. Congress sets it up that way to spur investment.

If you have an expensive truck use an accountant if you have a 13k vehicle it wont make as big of a difference.

 

Depreciation

 

You can use straight line depreciation or macrs depreciation(accelerated depreciation) like @77fib77 was talking about

 

Last few years we have taken 25,000(I think its a section 179) plus first year depreciation in the first year.The balance divided over the next four (regardless of your payments).Now after your truck has been depreciated fully and you sell you have to "recapture" that (means you get taxed on full amount you sold it for).I use a bookkeeper for this but that's my understanding of it.

 

Just sell to your other company then buy it back and start all over again ! Get an accountant dont feed the crooks I/E the IRS!