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SUV tax break a marketing bonanza SUV tax break a marketing bonanza ($100,000 tax deduction)
MSNBC ^
| Nov 7, 2003
| Jonathan Weisman
Posted on 11/08/2003 2:11:30 PM PST by Dan Evans
When Congress this year decided to allow small-business owners, doctors, lawyers and real estate salespeople to deduct up to $100,000 from their taxable income for the purchase of a luxury SUV, Texas car-dealership magnate Jerry Reynolds could hardly believe his good fortune.
HE TOOK to the radio to spread the news, drafted a treatise for the Internet, and last week, the man known around Dallas simply as the car guy began advertising in the Dallas Morning News. Its a loophole, the ad proclaims, and this weekend, we can show you how to make that loophole big enough to drive a fleet of trucks and sport utility vehicles through it!
The SUV loophole once seemed to be just a quirk in the tax code deplored by environmental activists but ignored by most everyone else. Now it is shaping up to be a marketing bonanza for financial planners, accountants and auto dealers eager to snap up commissions and drive up sales of heavy vehicles, ranging from workhorse Ford F-250 pickup trucks to elite Hummer H2s, BMW X5s and Mercedes-Benz ML55s.
Its really been an eye-opener for people, Reynolds said. And its been fun, Ive got to tell you.
(Excerpt) Read more at msnbc.com ...
TOPICS: Business/Economy; Culture/Society; Government; News/Current Events
KEYWORDS: suv; suvtaxbreak; taxbreak
Navigation: use the links below to view more comments.
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1
posted on
11/08/2003 2:11:31 PM PST
by
Dan Evans
To: Dan Evans
yet another reason for a flat tax...
2
posted on
11/08/2003 2:22:49 PM PST
by
LouD
To: Dan Evans
This is really outrageous.
3
posted on
11/08/2003 2:24:40 PM PST
by
Rodney King
(No, we can't all just get along.)
To: Dan Evans
for reading later
4
posted on
11/08/2003 2:25:38 PM PST
by
steveo
(Dave??? Dave's knot hear!)
To: Dan Evans
this law should be repealed. in fact, the entire deductibility of auto expenses is one of the most highly abused loopholes for these "small business" people, because they use these cars for their own personal transportation and write them off, while the rest of us have to pay full fare to own a car and drive it to work.
5
posted on
11/08/2003 2:27:03 PM PST
by
oceanview
To: LouD
yet another reason for a flat tax...
Yep. The higher the marginal rates, the more valuable the deduction becomes.
6
posted on
11/08/2003 2:30:27 PM PST
by
Paleo Conservative
(Do not remove this tag under penalty of law.)
To: Dan Evans
This increase to $100,000 for equipment purchase is one of the drivers to the recovery. It is really not that big of a deal though. It just speeds up how you take depreciation, so next year you won't be able to deduct anything. Without this rule you spread out the depreciation of equipment over 5 or more years instead of taking it immediately.
To: Rodney King
Actually, this tax break used to make sense when it was used by contactors, construction folks, and farmers. Still does, when they use it. Why do you think SUVs got so darn big? This was one of the reasons, to take advantage of the weight classification to get the tax break. The auto makers aren't dumb.
8
posted on
11/08/2003 2:34:20 PM PST
by
mewzilla
To: Dan Evans
One thing buried in the article, not in the excerpt.
""To get the full write-off, the vehicle is supposed to be used full time for business purposes. As long as it is used more than half the time for business purposes, its owner can deduct some of its purchase price say, 75 percent for a Chevy Suburban used 75 percent of the time for business.""
Not the slant the headline makes it out to be. Sure it can be abused, but the existing laws for write offs for professional and small businesses are little better...mostly just different...like the rules about leasing. You could write off a $100,000 before -- just had to space it out. This focus on just SUVs is bogus and is the result of anger at SUVs more than it's true concern about tax breaks.
To: Jackson Brown
It's being abused. Big time.
10
posted on
11/08/2003 2:35:16 PM PST
by
mewzilla
To: oceanview
this law should be repealed. in fact, the entire deductibility of auto expenses is one of the most highly abused loopholes for these "small business" people, because they use these cars for their own personal transportation and write them off, while the rest of us have to pay full fare to own a car and drive it to work. Sounds like you need to get your own business then if it is so good.
To: Dan Evans
The SUV is a perverse creature of the Federal Government. The only reason it exists is because of draconian and murderous regulations on the motor vehicle market called CAFE (Corporate Average Fleet Economy) standards. Manufacturers are required to make their fleet of passenger vehicles with an average fuel efficiency of 27 miles to the gallon. Trucks. SUVs and other Urban Assault Vehicles need only average 20 miles to the gallon.
The problem is, the only way to get the kind of fuel efficiency that will satisfy the bureaucrats is to make a lot of smaller lighter passenger cars. And disparities in vehicle size get people killed.
When a monster vehicle weighing about 8000 pounds has a get-together with a tiny 2000 pound roller skate, the college girl in that little car is going to end up in the morgue.
http://www.detnews.com/2002/editorial/0201/30/a11-402956.htm
But Congress know what's best for us.
CAPTAIN
"I'm doing this for your own good, Luke."
LUKE
"I wish you'd stop being so good to me, Captain."
The captain clubs Luke with his cane, sends him rolling down the hill.
12
posted on
11/08/2003 2:43:02 PM PST
by
Dan Evans
(All I see is a bunch of guys making rules and regulations.)
To: oceanview
Yes, and as an employee, you pay full freight for your Soc. Sec, tax, too. Along with Workmans Comp, business taxes just to have a business, along with Soc. Sec. matching. Along with paying employee benefits.
13
posted on
11/08/2003 2:44:10 PM PST
by
stylin_geek
(Koffi: 0, G.W. Bush: (I lost count))
To: Always Right
yeah, it sucks being honest.
To: oceanview
yeah, it sucks being honest. Well it also sucks having to pay both half of Social Security/Meidcare and buy your own medical insurance and do all the paper work.
To: Dan Evans
Trucks. SUVs and other Urban Assault Vehicles...a monster vehicle weighing about 8000 pounds has a get-together with a tiny 2000 pound roller skate...Nomination for the imaginative jargon award.
Tin foil hat on...you live in a small apartment without a yard, you think deodorant causes cancer, and ANWR animals will stay nice and cool if we don't drill for oil.
16
posted on
11/08/2003 2:52:40 PM PST
by
NautiNurse
(Everyone is born right handed. Only the exceptionally gifted overcome it.)
To: oceanview
The trouble with most tax incentives and government regulations is that they give dishonest people an advantage over honest people. And that's a bad thing.
To: NautiNurse
You ought to read up on some of the marketing studies the auto makers have done on who buys SUVs and why. Urban Assault Vehicles isn't far off. The auto makers know their customer base.
18
posted on
11/08/2003 2:56:18 PM PST
by
mewzilla
To: Dan Evans
Dan Evans' Adventures at Home Depot:
19
posted on
11/08/2003 2:59:41 PM PST
by
NautiNurse
(Everyone is born right handed. Only the exceptionally gifted overcome it.)
To: NautiNurse
I have no problem with people who buy these monsters. The problem is the government that gave them the incentive to buy them when them normally wouldn't have.
I wager that a lot of people buy SUVs and trucks simply because they are 6'3", or they have large families, or they car-pool and can't fit in a smaller government-mandated car -- they need the legroom. If we didn't have CAFE regulations, there would be more larger, reasonably priced cars available.
Why make regulations that get people killed?
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