What advantage is there to having a beater (that you hardly drive) and a daily luxury (let’s say your lease is >$1,000/ month) vehicle?
Assuming you’ll need to form a business, is the beater worth keeping? Or selling it off? The beater vehicle will be worth ~$5,000. Mileage on both cars driven can be flexible.
As we normally do on leasehackrs, make it as best a deal as possible. How can we make it worth keeping the beater? Or just selling it. Store it keeps depreciating more?
I don’t know about tax purposes… but I have a beater Acura I plan on driving for years and into the ground just to get to work and then I was going to get something like an S5 Sportback for my weekend getaways. Reduced maintenance on the S5 and hopefully lower insurance costs because it’ll be a limited use vehicle. It’ll also retain value better with lower mileage.
Yeah I had a buddy that owned an m5, and then bought a 10 year old Honda Civic to drive to work occasionally.
His insurance actually went down when he added the civic to the policy.
It actually makes perfect sense because the insurance company’s exposure is significantly reduced when the policy holder is driving around a bucket and the $100k sports car is garaged.
I don’t believe in a beater unless you drive excessive miles a year and even then it depends.
Paying Insurance for two cars (the above scenario is unlikely, adding cars increases insurance cost most of the time)
Old cars are likely to have worse crash ratings to more dangerous, why expose yourself to higher risk of injury?
Paying registration for two cars
Old cars break all the time, even if you don’t drive them much
Lack of modern features/less comfortable
If this is for business/tax purposes, you’re most likely just taking the mileage deduction regardless of which car is being driven, no? I don’t really see the benefit, if anything it just makes things more complicated, having to track mileage and expenses for two vehicles.
You definitely bring up valid points.
Trying to see whether having that “beater” will somehow be worth it in any way, shape, or form by having any additional write offs (more for your expensive lease).
Seems like it may not but then again I’m not a CPA
I believe that he saved insurance. Each person on your policy has to be assigned a vehicle. If you are the primary on an old Honda, you save. I have 4 cars and I am the primary on the one that saves me the most.
A beater under $5k won’t depreciate much depending on what it is. Regarding tax purposes, it is complicated enough that I wouldn’t feel comfortable giving advice without knowing more. However, if you just want to justify the beater, that is easy. Get insurance quotes with cheap insurance on the beater and list that as your primary. Own a beater such as a Civic or Tacoma etc that will depreciate very little. Drive it a bit and maybe you can do a 10k lease vs a 15k lease. Skip rental company coverage on your policy.
Typically the lease is the tax break, not the beater.
Correct, he is a single guy, and by adding the beater it significantly decreased his miles per year on the m5.
I write off part of my car for business. I also have a Suzuki motorcycle which means I can write off more of the car. Not sure what this years new tax code will do