Best way for car purchased for business

[rfk]

Hello all,

Please comment on best way to title or hold vehicle used mostly for business purpose; maybe about 10 - 20 % for personal use. Should it be titled in personal and setup an accountable plan for any type of entity (Sole prop, etc.) or what is the best.

At present, the entity is a sole prop, but thinking about a corporation possibly; not sure yet. Person wants to buy vehicle for use in business by tomorrow.

Thanks for your help.

rfk

[taxea]

I would recommend registering it in the company name and keeping good mileage and expense records so that the 10-20% personal use can be easily allotted out for tax purposes.

[Gary2]

Are there any choices if it's a sole proprietorship? There is no separate entity.

[luke]

more

Also "owner" of business should check with the auto ins agent to see if they will write policy in company name ? Steer client towards deduction for business mileage (as sole prop) - If he forms corp then reimbursement for business mileage.

[taxea]

Are there any choices if it's a sole proprietorship? There is no separate entity.

I think the same ones would apply regardless of the type of business entity. Of course there are choices. I maintain my original answer

[Gretel]

If your client is headed for a corporation you want to take into account that corporation cannot take the SMR. It's a mute point now but you seem to be concerned about the near future actions of your client.

Also, normally corporation insurance rates are much higher than vehicles titled in personal name, if the insure corporate vehicles at all.

As a Sch.C I would have client title in his name for sure.

[Gary2]

I think the same ones would apply regardless of the type of business entity. Of course there are choices. I maintain my original answer

Once the corporation exists, then it becomes an option that simply isn't available to a sole proprietorship.