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  • Deducting vehicle purchace

    I am considering buying an F-150 (gvw > 6000). I am in private practice with a partnership. I do 1099 side gigs of nursing home and hospice work. I live in rural America so it is not unusual for a physician to drive a truck. I end up driving to multiple locations each day (ie not just to work and back to home) and I am often called to the er/hospital on nights/weekends.

    As long as I drive it > 50% for work, are there any other tax pitfalls for me to consider?

    Do others have experience taking a section 179 deduction for a vehicle as their work as a physician?

  • #2
    Not sure I understand your question about "other tax pitfalls". But you should keep very good records. Depending upon your partnership agreement, you may be able to deduct some of the cost as UPE. Recommend you set up a dedicated home office if you have the space and you do your scheduling, bookkeeping, etc from home.

    Our clients typically use MileIQ for tracking miles, other good ones out there, too. You'll need mileage records whether you use actual or mileage deduction for your vehicle.

    Expect you're working with an experienced CPA, who s/b providing personalized advice about all of this.
    Our passion is protecting clients and others from predatory and ignorant advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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    • #3
      Sounds like you need to carefully go over what driving would qualify as work related versus regular commuting. I would say that is the major pitfall to consider as your deduction is proportionate to business use. Agree you should be working with a CPA.

      I am not a tax expert but I would think getting called into the hospital would count as normal driving to work not a business related use of vehicle. Does driving from main job in your private practice to a side gig count as business use?

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      • #4
        Even as someone who pushes the envelope myself, these threads crack me up. I have a side gig for which I actually need a truck, but the risk/reward just isn't worth the hassle.

        You don't need a truck to do your job; the guy who showed up at my house a couple months back with a bed full of springs, garage doors, hydraulic equipment and the company name painted on the side needs a truck to do his job.

        I would just keep track of the mileage as you putter around through the work-day for main job (if allowed) and trips to the SNF from your home office for the side gig and call it good.

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        • #5
          G I don’t think the law says anything about if you need a car >6000 lb gvw. Is said if you use.

          I do disagree on a call back to the hospital. I’m not on a salary. I do not get paid for call. Only production. So if I have to drive to the hospital after I have returned home from my main office commute the mileage would count.

          I think all business miles outside of primary commute from work to home count.

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          • #6
            “I think all business miles outside of primary commute from work to home count.”

            No offense, never heard or saw “primary” before used for business travel. Ordinary and necessary yes. Best case, park the truck at work. Don’t commute or use it for personal. Then worry about the ordinary and necessary.

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            • #7
              Originally posted by runfast00 View Post
              I do disagree on a call back to the hospital. I’m not on a salary. I do not get paid for call. Only production. So if I have to drive to the hospital after I have returned home from my main office commute the mileage would count.

              I think all business miles outside of primary commute from work to home count.
              I'm not an accountant but I'm not sure this is correct. What does your accountant say?

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              • #8
                Originally posted by runfast00 View Post
                G I don’t think the law says anything about if you need a car >6000 lb gvw. Is said if you use.

                I do disagree on a call back to the hospital. I’m not on a salary. I do not get paid for call. Only production. So if I have to drive to the hospital after I have returned home from my main office commute the mileage would count.

                I think all business miles outside of primary commute from work to home count.
                Interesting take about call mileage. I don't disagree with you about the truck, just pointing out the suspicion that an auditor would have.

                Remember, you can deduct whatever you want, the question is if it survives that slim chance of an audit.

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                • #9
                  Originally posted by runfast00 View Post
                  G I don’t think the law says anything about if you need a car >6000 lb gvw. Is said if you use.

                  I do disagree on a call back to the hospital. I’m not on a salary. I do not get paid for call. Only production. So if I have to drive to the hospital after I have returned home from my main office commute the mileage would count.

                  I think all business miles outside of primary commute from work to home count.
                  As others have said, it only matter if you get audited. If you get audited, it does not matter what you or I think but what the IRS thinks. If you want to be safe hire an expert and follow their advice.

                  I don't see how getting paid or not for call would change if it is a commute. If it is the same day I think you can deduct the distance between your office and the hospital (one way only). From my limited / non-expert understanding, each day you have one commute that is not deductible (home to first place of work and last place of work to home are not deductible). Any extra trips such as going home during the day area also not deductible. Now if you have a home office for your 1099 business that may change things. Again I would pay an expert to review everything (but I'm on the conservative side when it comes to such things).

                  Couple things that may help per IRS.gov (https://www.irs.gov/publications/p463):

                  No regular place of work.

                  If you have no regular place of work but ordinarily work in the metropolitan area where you live, you can deduct daily transportation costs between home and a temporary work site outside that metropolitan area.

                  Generally, a metropolitan area includes the area within the city limits and the suburbs that are considered part of that metropolitan area.

                  You can’t deduct daily transportation costs between your home and temporary work sites within your metropolitan area. These are nondeductible commuting expenses.

                  Two places of work.

                  If you work at two places in 1 day, whether or not for the same employer, you can deduct the expense of getting from one workplace to the other. However, if for some personal reason you don’t go directly from one location to the other, you can’t deduct more than the amount it would have cost you to go directly from the first location to the second.

                  Transportation expenses you have in going between home and a part-time job on a day off from your main job are commuting expenses. You can’t deduct them.

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                  • #10
                    Even if you have multiple locations on your primary job you can deduct mileage.

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                    • #11
                      proper or not in my limited experience docs “running their cars through the practice” is common

                      in transit stickers in the doctors lot commonly have business names on them

                      to the OP this should start as a discussion with partners and CPA

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                      • #12
                        Originally posted by runfast00 View Post
                        Even if you have multiple locations on your primary job you can deduct mileage.
                        Right, after your first trip from home. Unless your primary job is your home office.

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                        • #13
                          I could be (correction, I am definitely) out of my element here, but are you, OP, referring to mileage or purchase price deduction? Or both?
                          $1 saved = >$1 earned. ✓

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                          • #14
                            Originally posted by Cubicle View Post
                            I could be (correction, I am definitely) out of my element here, but are you, OP, referring to mileage or purchase price deduction? Or both?
                            yeah I think people are confusing deducting mileage and section 179 previously known as the Hummer loophole.

                            https://www.section179.org/section_1...le_deductions/

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                            • #15
                              My understanding is the poster was asking about the 179 deduction. However, it sounds as though the vehicle is going to be less than 100% business use. As such, the mileage would be the way to determine what percentage is business use versus personal. 179 has a threshold of 50% but even if you meet 50% the depreciation amount is proportional to business use.

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