Mark Kohler breaks down why a $50,000 vehicle with only 5,000 business miles a year tanks your tax deduction to a few thousand dollars. Keep personal use below 50% and use an expensive car only for client meetings, not daily work trips.
So you go buy that very nice vehicle or truck and you're over $50,000 and you want to save it for the nice trips, nice client meetings, you know, the nice client meetings, right? You're not commuting in this thing, it's the nice car and you're not putting on a lot of miles. Your deduction even went down further. You only put on 5,000 miles. So now, man, we're down to $3,500. See what you did there? Yeah, whatever. You know what you did there? You did fewer miles business, but the car value went up.
So the mileage is hurting me. So what you're saying is, actual, which is a good point here, if you do have some personal use of that, you want to make sure it's below 50%. So you're only taking that car out for the great client meeting. You're trying to impress. You're the real estate agent driving your clients around looking at houses. Leave that POS car at home. That's the one you take mileage on when you bring it out.
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