So, I can use this to get my new F350 Turbo Diesel? Cool.
Steve Spence Subscribe to the Renewable Energy Newsletter & Discussion Boards. Read about Sustainable Technology: http://www.green-trust.org [EMAIL PROTECTED] ----- Original Message ----- From: "Keith Addison" <[EMAIL PROTECTED]> To: <biofuel@yahoogroups.com> Cc: <biofuels-biz@yahoogroups.com> Sent: Saturday, December 21, 2002 2:37 PM Subject: [biofuel] SUV, truck owners get a big tax break > http://www.detnews.com/2002/autosinsider/0212/18/c01-38875.htm > - 12/18/02 > Wednesday, December 18, 2002 > > David Coates / The Detroit News > > Karl Wizinsky, a health care consultant in Novi, was able to write > off $32,000 of the $47,000 purchase price of a Ford Excursion as a > business expense. It's perfectly legal, and accountants and auto > dealers are starting to catch on. > > SUV, truck owners get a big tax break > > Loophole allows hefty write-off for vehicles > > By Jeff Plungis / Detroit News Washington Bureau > > Eligible vehicles > > Here are the 38 light truck models that qualify for an extra $24,000 > accelerated depreciation tax break: > BMW X5 > Cadillac Escalade > Chevy Astro > Chevy Avalanche > Chevy Express > Chevy Silverado > Chevy Suburban > Chevy Tahoe > Dodge Durango > Dodge Ram Van > Dodge Ram Maxi Van > Dodge Ram Wagon > Dodge Ram 1500 > Dodge Ram 2500 > Dodge Ram 3500 > Ford Excursion > Ford Expedition > Ford Econoline E-150 > Ford Econoline E-250 > Ford Econoline E-350 > Ford F-150 > Ford F-250 > Ford F-350 > GMC Yukon > GMC Safari > GMC Savana > GMC Sierra > GMC Sierra Denali > Land Rover Discovery > Land Rover Range Rover > Lincoln Blackwood > Lincoln Navigator > Mercedes ML 320 > Mercedes ML 500 > Mercedes ML55 AMG > Toyota Land Cruiser > Toyota Sequoia > Toyota Tundra > > Comment on this story > Send this story to a friend > Get Home Delivery > > WASHINGTON -- Karl Wizinsky wasn't thinking about buying a new > vehicle, and certainly not a big SUV. So why is there a brand-new > $47,000 Ford Excursion sitting in his driveway? > > He was able to write off $32,000 of the purchase price as a business expense. > > "We really did it because it was a pretty hefty deduction," said > Wizinsky, a health care consultant in Novi. > > At the same time the tax code sanctions $30,000 write-offs for SUVs, > prospective purchasers of a fuel-efficient hybrid vehicles qualify > for a relatively small $4,000 tax credit. > > A deal to extend similar tax credits to other environmentally > friendly vehicles remains stalled in Congress. > > It's all legal, and accountants and auto dealers are beginning to catch on. > > "If it can save the consumer money, it's most likely that the dealer > is going to know about it," said Andrew Beck, spokesman for the > National Automobile Dealers Association. So far, there is no > indication anyone in Congress wants to close the loophole. In fact, > even higher depreciation tax breaks are on the table as part of the > next round of tax cuts President Bush is planning. > > The SUV tax break is becoming a staple of advice in the accounting > world, as small business owners such as Wizinsky are advised on ways > to reduce end-of-the-year tax bills. > > The size of the tax break has been growing under a schedule that > became law in 1996. That's when Congress changed tax law to encourage > business investment. > > The scale of the tax break surprises accountants and tax experts, who > feel bound to recommend SUVs and other light trucks to small-business > clients. > > "As I understood it, the reason (for the tax break) is to encourage > business investment. That's what happened in my case," Wizinsky said. > > At the same time, the tax break seems to contradict other national > goals, such as improving vehicle fuel efficiency. A more economical > fleet would aid two important national goals: reducing U.S. > dependence on foreign oil and cutting greenhouse gasses. > > The total cost of the loophole hasn't been calculated by the > government, but Taxpayers for Common Sense, a nonpartisan Washington > watchdog group, estimates the SUV tax loophole could cost taxpayers > between $840 million and $987 million for every 100,000 vehicles sold > to businesses. > > Aileen Roder, the group's program director, questioned whether there > is a national need to subsidize sales of the largest light trucks -- > given Americans are buying SUVs in record numbers. > > "This is one of the most lucrative breaks in the tax code," Roder > said. "We're making it a fiscal no-brainer for businesses to buy > giant SUVs." > > To get an idea of the scale of the SUV tax break, a credit aimed at > making it easier for small businesses to comply with the Americans > with Disabilities Act costs $525 million per 100,000 uses. > > A tax credit to reimburse teachers for classroom supplies annually > costs the treasury $250 million per 100,000 uses. > > And a provision allowing taxpayers to put up to $3,000 of tax-free > earnings per year in private retirement accounts costs about $90 > million per 100,000 taxpayers, according to Taxpayers for Common > Sense. > > There are long-standing limits on deductions to prevent taxpayers > from subsidizing luxury-car purchases. But the limits do not apply to > 38 light trucks that weigh 6,000 pounds or more, including the > Cadillac Escalade, Dodge Durango, Excursion and Lincoln Navigator. > > "We recognized it immediately and started informing people about how > to use it," said James Jenkins, an accountant in Southfield. "It's > just fabulous. My clients have been drooling." > > Jenkins said five clients have used the loophole so far and five more > are considering it. Jenkins even considered using the break, > test-driving several SUVs. > > "It makes you think very hard about it," Jenkins said. "But it was a > 30 percent larger vehicle than I wanted." > > Here's how the SUV tax break works: > > Suppose a business owner wants to purchase a $45,000 luxury SUV for > use in his business. He or she could write off $24,000 of the cost > under section 179 of the tax code as accelerated depreciation. Then > the buyer could write off additional depreciation of the remaining > $21,000 under a five-year schedule -- 20 percent, or $4,200, in the > first year. > > That's a total $28,200 tax write-off. > > The balance of the vehicle could be written off over the next five > years. A more expensive large vehicle, like a Mercedes E-class SUV, a > Range Rover or a BMW X5, would qualify for an even greater tax break. > > The break for trucks got bigger this year under a schedule Congress > adopted in 1996 when businesses could claim $17,500 in accelerated > depreciation on equipment. > > That lump sum increased to $20,000 last year. It went up to $24,000 > this year. Next year and thereafter the deduction will be $25,000. > > In 1996, Congress estimated the five-year cost of the tax break -- > for all business equipment -- to be $1.6 billion. But luxury SUVs had > barely cracked the market at that time. > > IRS spokesman Bruce Friedland said the agency does not keep data on > how much the tax break has cost. According to figures supplied by > Autodata, there were 3.8 million of the 6,000-pound light truck > models sold in 2001. > > There are no estimates for how many of the vehicles that qualify were > sold to businesses or how many businesses that bought vehicles took > advantage of the deduction. > > The code is not as generous for luxury cars. > > A business owner wanting to purchase a Lincoln Town Car would have to > live with a $7,660 deduction, one-fourth what he might save by buying > a Lincoln Navigator. It would take more than 15 years to recoup the > entire cost of the car. > > After Sept. 10, 2004, the luxury-car write-off will revert to $3,060. > > Tax experts say the light-truck tax loophole was originally targeted > for farmers, so their working pickup trucks would not be treated, for > tax purposes, like luxury cars. > > There was no mention of the need to stimulate the luxury truck market > in the 1996 tax debate. > > The House of Representatives attempted to make the SUV tax break even > more generous as Congress debated an economic stimulus package in > March. > > Under the House plan, the cap for accelerated depreciation would have > risen from $24,000 to $35,000. That effort died in negotiations with > the Senate. > > You can reach Jeff Plungis at (202) 662-7378 or [EMAIL PROTECTED] > > > Biofuel at Journey to Forever: > http://journeytoforever.org/biofuel.html > > Biofuels list archives: > http://archive.nnytech.net/ > > Please do NOT send Unsubscribe messages to the list address. > To unsubscribe, send an email to: > [EMAIL PROTECTED] > > Your use of Yahoo! Groups is subject to http://docs.yahoo.com/info/terms/ > > > Biofuel at Journey to Forever: http://journeytoforever.org/biofuel.html Biofuels list archives: http://archive.nnytech.net/ Please do NOT send Unsubscribe messages to the list address. To unsubscribe, send an email to: [EMAIL PROTECTED] Your use of Yahoo! Groups is subject to http://docs.yahoo.com/info/terms/
