I want to start this post by saying I don’t want it to start an angry thread about the merits of our current President we all have an opinion I’m sure and no one is going to change their mind.
But one thing I found out today is that if you are an employee (not a business owner or self employed person) whereas previously you could claim your lease as a deduction starting in 2018 you cannot.
That has a huge huge effect on the cost of leasing if like me your effective tax rate is north of 40%
Yes, that category is out. However, I assume you can claim mileage at standard irs deduction. Again, not an expert but that would not be cool. Imagine you deliver pizzas or whatever, does that mean you cannot claim those miles?
Which is why we will see a boom in one person llcs. Set yourself as up as an llc and deduct away. Many doctors dentists etc are going to be doing just that. Setting up llcs to benefit from the deductions and pass through rules.
Doctors and dentist, are businesses, the OP is not self employed, therefore LLC would not or for him. Plus even if he did, the IRS would see he gets a W2, reported by his employer. His best bet, deduct mileage at the current IRS rate.
If that’s what he does. I don’t know his situation. Though, you’re right - just read over his top line post where he does say it’s an unreimbursed employee expense.
How can your effective tax rate be 40% with the new tax laws? Doesn’t it max out at 37% if you make more than 500k single and 600k married? If so, aren’t these rates lower than what they were before saving you much more than you lose on the lease? Also, if you are making more than 500k, than the few grand you deduct off your taxes for a lease shouldn’t really matter that much. You can still deduct mileage you drive for your job, aka not to and from the office but anything in between. That usually works out better if you drive a lot anyway versus doing real expenses, at least in my experience, but that was with cheaper vehicles, I’m sure if you’re driving an S63 or something, the gas, lease, maintenance, etc will be higher than the 54.5 cents per mile.