Truck Cap

[Kram BergGold]

My client is going to purchase a new pick up truck in a week or two. For 2017 he will claim standard mileage rate. Then in 2018 he will switch to actual. If he buys a truck cap in 2017 separately from the truck purchase, can it be expensed under Section 179 as a piece of equipment?

[Snaggletooth]

I wouldn't think so

As usual, can't give you cites, but I think the idea of adding accessories and depreciating them separately runs afoul of the very purpose the IRS set up rigid rules for automobiles to begin with. For example, if he had purchased the vehicle with a cap intact and all included in the selling price, would you be able to do this?

[Rapid Robert]

My client is going to purchase a new pick up truck in a week or two. For 2017 he will claim standard mileage rate. Then in 2018 he will switch to actual. If he buys a truck cap in 2017 separately from the truck purchase, can it be expensed under Section 179 as a piece of equipment?

You don't state the weight of the pickup truck, but you can't treat the cap as other than listed property.

Several relevant excerpts from TheTaxBook:

"Passenger autos. For purposes of the section 280F limitations, a passenger auto is any four-wheeled vehicle that is made primarily for use on public streets, roads, and highways. Its unloaded gross vehicle weight must not be more than 6,000 pounds. A passenger auto includes any part, component, or other item that is physically attached to it or is usually included in the purchase price."

"In addition to automobiles, section 280F applies to the following:
• Any other property used for transportation, unless it is an excepted vehicle."

"Improvements to listed property. An improvement made to listed property that must be capitalized is treated as a new item of depreciable property. The recovery period and method of depreciation that apply to the listed property as a whole also apply to the improvement. "

[Kram BergGold]

Rapid Robert

I think you are saying that if the truck weighs enough so that it is not listed property, then it might fly that the cap can be treated separately and expensed in 2017. Yes, No?

[Kram BergGold]

Final Answer

I called NATP research. They said the cap can be expensed as equipment as it is being bought separately and can be removed and sold separately and is not material to the operating of the vehicle.

[TAXNJ]

Compliments....

for pursing a good final answer.

[dtlee]

NATP Research

While not perfect, I have found the research arm of NATP to be a significant benefit. I usually will use their free research question for a second opinion on some arcane topic each year. They willingly offer citations when they reply and allow follow-up questions to clarify either the question or the answer.

Thanks for sharing their response.

[Rapid Robert]

I called NATP research. They said the cap can be expensed as equipment as it is being bought separately and can be removed and sold separately and is not material to the operating of the vehicle.

Did they provide support for that? Does an individual's name and credentials (attorney, CPA, EA, etc) come with the written advice they provided, or is it anonymous?

I'm not knocking NATP, I'm a member and I think I used the research service once. They could well be correct, but if the issue were audited by the IRS, would the IRS just roll over and say, if NATP says so it must be true? I would expect that an opinion would require some kind of search and analysis of existing court cases, regs, etc. Maybe the dollar amount involved is not worth the effort.

[TAXNJ]

When....

Did they provide support for that? Does an individual's name and credentials (attorney, CPA, EA, etc) come with the written advice they provided, or is it anonymous?

I'm not knocking NATP, I'm a member and I think I used the research service once. They could well be correct, but if the issue were audited by the IRS, would the IRS just roll over and say, if NATP says so it must be true? I would expect that an opinion would require some kind of search and analysis of existing court cases, regs, etc. Maybe the dollar amount involved is not worth the effort.

you called the same professional research group of which you said you are a member for information, did they provide you their name, credentials and a written response? If yes, why would it be different when poster (Kram B.) used the same service?

You provided a interesting reply post. Are you saying in your reply post that a moveable truck cap placed on a pickup truck bed is an "improvement" that is an integral part and/or extends the life of the truck or make it operational? If so, then how would a tool box or a tarp (instead of a (truck cap)) placed on the truck bed be treated?

Also, do you think if there was an audit that the poster (Kram B.), whatever position is taken by the poster, would state the professional research group is what the position is based on or if the poster stated that Rapid Robert on a website is what the position is based on. Think Kram B. would know rather to use only the code sections, etc. provided.

[Rapid Robert]

you called the same professional research group of which you said you are a member for information, did they provide you their name, credentials and a written response? If yes, why would it be different when poster (Kram B.) used the same service?

I don't remember. As I indicated I'm not even sure I actually did use NATP research, and if so it would have been a number of years ago.

As to the rest of your comments, in my first response, I was just raising some possibly pertinent issues. I did not take a position, other than it sounded like it met the description of listed property. No one has addressed Snaggletooth's comment, either. We still don't even know the weight of the vehicle.

I also didn't say or imply anything about Kram's ability to defend an audit, so I'm not answering your "do you think" questions about that. What I did do was ask what support NATP research provided as part of its answer, so we could all share in the knowledge. I think NATP would appreciate the publicity. The answer Kram shared with us is a nice summary, but it's hard to see how it's a "good" answer without knowing the reasoning behind it.

[TAXNJ]

Thanks....

I don't remember. As I indicated I'm not even sure I actually did use NATP research, and if so it would have been a number of years ago.

As to the rest of your comments, in my first response, I was just raising some possibly pertinent issues. I did not take a position, other than it sounded like it met the description of listed property. No one has addressed Snaggletooth's comment, either. We still don't even know the weight of the vehicle.

I also didn't say or imply anything about Kram's ability to defend an audit, so I'm not answering your "do you think" questions about that. What I did do was ask what support NATP research provided as part of its answer, so we could all share in the knowledge. I think NATP would appreciate the publicity. The answer Kram shared with us is a nice summary, but it's hard to see how it's a "good" answer without knowing the reasoning behind it.

for the reply. Just trying to understand the excerpts in your prior post and how it would apply? Are you saying in your reply post that a moveable truck cap placed on a pickup truck bed is an "improvement" that is an integral part and/or extends the life of the truck or make it operational? If so, then how would a tool box or a tarp (instead of a (truck cap)) placed on the truck bed be treated?

[Rapid Robert]

an integral part and/or extends the life of the truck or make it operational?

This language you've been using was not in TheTaxBook excerpts I copied. Is it coming from a specific code or reg? Maybe NATP knows, but I don't.

A 2nd camera lens is not integral or life-extending or needed for operation of a camera, but it is still listed property. A second monitor screen is not integral or life-extending or needed for operation of a computer, but it's still listed property if the computer is. So why would a truck cap be different, if the truck is listed property?