Date: Fri, 5 Dec 2003 08:29:09 -0800
Reply-To: mark drillock <drillock@EARTHLINK.NET>
Sender: Vanagon Mailing List <vanagon@gerry.vanagon.com>
From: mark drillock <drillock@EARTHLINK.NET>
Subject: Re: Volkswagen,the dumbest auto company in the world.. (NVC)
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Back in 1978 I worked for a small software company that purchased a 1978
VW Bus for use as a company vehicle. I'm SURE they got a tax write-off
for it (AKA subsidy). That is how business investment rules have worked
for many decades. IIRC, the Dems held the whitehouse and both houses of
congress at that time. The controversy back then was whether VW vehicles
should even qualify as they were an evil foreign import and were hurting
US car makers with their practical and fuel efficient products.
Depreciation write-off rules apply to almost any business equipment
purchase, even one of a Vanagon or Eurovan. A daycare center that buys
playground equipment, a fence, or a Eurovan can depreciate that purchase
if they follow the rules. This will reduce the tax bill of the daycare
center operator as taxes are paid on net income after allowable
expenses. You needn't be a corporation to qualify for business purchase
write-offs.
The accelerated depreciation rules that have raised some people's
hackles have been around for many years. The dollar limit for the amount
that can be depreciated in the first year was recently raised for
certain types of equipment. Hummers and RangeRovers along with some
other vehicles that seem to inspire class envy among some Vanagon owners
fall into a category that largely includes vehicles used by small
businesses and farmers. Again, they don't have to be corporations though
many are. Almost any business is likely to be a corporation these days
as the use of a corporate status provides numerous legal and accounting
advantages, even to small day care centers.
The first year write-off limit in question is not $10,000. It is now
$100,000 as opposed to the long previous $25,000. That means that the
purchase of a qualifying $100,000 vehicle can now be depreciated
$100,000 in a single year instead of over 4 years of $25,000 increments.
The total amount has not changed. The stated purpose was to encourage
immediate investment by small businesses to stimulate the economy.
Letting them deduct more in the first year and less in the later years
rewards them now for spending money now though they may pay higher taxes
later.
Presidents and their administrations do not make tax laws. Those laws
are passed by Congress. If you wish to have your opinions known by those
who can do something about it, contact your representatives. If you live
in one of the 50 states you have 3 such representatives.
The US tax code is of dizzying complexity and I don't profess any
comprehensive knowledge of it or even this aspect of it. If I made any
egregious errors feel free to let me know.
Mark
old computer guy from the age of Dinosaurs
Gnarlodious wrote:
>
> Entity Jeff Stewart spoke thus:
>
> >> that's EIGHTY EIGHT THOUSAND FREAKING DOLLARS....
> >> who the F**k is going to buy these things???
> >
> > The same idiots who buy Hummers to drive to the shopping malls, of course!
> > Jeff
> By "idiots" I assume you mean Republicans. Don't forget the Bush
> administration has s a $10,000 tax writeoff (AKA subsidy) to corporations
> buying these vehicles. They're a LOT cheaper than the sticker price
> suggests. VW wants a piece of the action just like every other car company.
>
> --Gnarlie