Advertising or Capital Asset?

Taxadvisor VA

Senior Member

Join Date: Feb 2013

Posts: 122
#1

Advertising or Capital Asset?

01-16-2014, 12:13 PM

Client has a fleet of 4 trucks that are leased. They just paid over $12K to have them wrapped (painted..etc) with the company information. Client wants to record as fixed asset and depreciate. I say expense to advertsing b/c they are a sign on the vehicle that will definitely bring in business over the next 48 months (Lease terms). My point is that the value of the vehicle is not increased just b/c painted signs are on them. Yes- the signs will bring a benefit past 12 months but I don't believe it warrants treatment as an asset.

What's your read?
Thanks,

Taxadvisor VA
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ATSMAN

Senior Member

Join Date: Jul 2013

Posts: 2415
#2

01-16-2014, 01:03 PM

I would treat it as advertising. My clients have trucks and they pay for signage but not wrap the whole truck.

Taxes after all are the dues that we pay for the privileges of membership in an organized society. - FDR
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BOB W

Senior Member

Join Date: Jun 2005

Posts: 4060
#3

01-16-2014, 01:24 PM

I you want to play it safe...Capitalize and take Sect 179.

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