Question added to topic Money • April 18, 2008
Should I lease a car through my business to offset my yearly business income?
I am a private practice psychologist and I travel about 25 percent of the time for business (to and from office/clients). The remainder is personal use. I have also thought of adding a car magnet to advertise my business to the lease, if I do it. My business is a small part ($10,000-$15,000/year) of my overall income. The majority ($49,000) is from hourly work in public schools.
If you use it for mostly personal use, that part isn't going to be a "business deduction" and most likely is not going to be advantageous to your situation. Depending on your past tax filings, you are most likely going to be better by doing mileage tracking and reimbursement at the IRS allowed rate and keeping the automobile personal since the majority of your travel is personal. As always, visit with your personal tax professional for guidance related to your specific situation.