Hi All,
I admit that I have made a large mistake on this subject, I spoke to the Small Business Division of the IRS ,Today 10-24-2011 with Mr. Michael Woods in Columbia, SC. I had asked him to interept the length of time that this deduction can be used.
His answer is based on the IRS Code, and Not Publication 946, How to Depreciate Property.
If you take Depreciation on a Cargo Van the maximun # of years is 5, with a life of 6. depending on the day of the year it is first put into service.
If you use the depreication method, all expenses are claimed as a deduction except mileage.
If you start with the standard mileage rate when the vehicle is first put into service, then it can be used until that vehicle is either:
" SOLD, TRADED OR TAKEN OUT OF SERVICE"
You also must keep accurate daily records for every mile driven for business purposes only, any personal miles must not be figured.
Meaning as follows:
Leave (home, truckstop) to Pick up load at shipper
Deliver to Reciever
Deadhead to Truckstop,or go back home, or place where you will layover.This is your business miles,
IF you are laid over and go to a Movie, theme park, shopping , Except for repairs, maintenance, truck wash, this is considered personal miles and cannot be figured in your business miles.
Since as of this year 2011 the standard mileage rate is cause for audit, these records, combined with you proof of being on the road for the Per Diem must be accurately kept Daily.(These are truthfully a very possibe RED FLAG)
It is best to use some sort of combination for both Mileage and Per Diem on the same proof sheet,
When I was on the road myself, I used a Steno Pad
left Side was:
Shipper - Date Picked up
Receiver- Date Delivered
Right side: Start Mileage
And Every time I stopped I marked the mileage down.
and Ending Mileage to layover Location.
iF YOU USE THE STAN DARD MILEAGE RATE YOU CANNOT DO WHAT YOU HAVE BEEN DOING IN THE PAST.
YEAR ENDING MILEAGE IS: xxxxxxxx
YEAR BEGINGING MILEAGE WAS: -xxxxxxxx
TOTAL MILEAGE: xxxxxxxx
I know we have had some disagreements before, but I now admit I was incorrect.
Frank’s Tax and Business Service
120 York Rd
Kings Mountain, NC 28086-3151
(704) 739-4039 Fax: (704) 739-3934
e-mail: [email protected]
Web Site: File Your Return Online
Franklin Katz, ATP, PA, PB,
Providing Professional Accounting Services and Income Tax Preparation
Circular 230 Disclaimer – Any tax advice in this communication (including any attachments) is not intended or written to be used, and cannot be used, by any taxpayer for the purpose of avoiding related
penalties under the Internal Revenue Code or (2) promoting, marketing or recommending to another party any transaction or tax
related matters addressed herein.
I admit that I have made a large mistake on this subject, I spoke to the Small Business Division of the IRS ,Today 10-24-2011 with Mr. Michael Woods in Columbia, SC. I had asked him to interept the length of time that this deduction can be used.
His answer is based on the IRS Code, and Not Publication 946, How to Depreciate Property.
If you take Depreciation on a Cargo Van the maximun # of years is 5, with a life of 6. depending on the day of the year it is first put into service.
If you use the depreication method, all expenses are claimed as a deduction except mileage.
If you start with the standard mileage rate when the vehicle is first put into service, then it can be used until that vehicle is either:
" SOLD, TRADED OR TAKEN OUT OF SERVICE"
You also must keep accurate daily records for every mile driven for business purposes only, any personal miles must not be figured.
Meaning as follows:
Leave (home, truckstop) to Pick up load at shipper
Deliver to Reciever
Deadhead to Truckstop,or go back home, or place where you will layover.This is your business miles,
IF you are laid over and go to a Movie, theme park, shopping , Except for repairs, maintenance, truck wash, this is considered personal miles and cannot be figured in your business miles.
Since as of this year 2011 the standard mileage rate is cause for audit, these records, combined with you proof of being on the road for the Per Diem must be accurately kept Daily.(These are truthfully a very possibe RED FLAG)
It is best to use some sort of combination for both Mileage and Per Diem on the same proof sheet,
When I was on the road myself, I used a Steno Pad
left Side was:
Shipper - Date Picked up
Receiver- Date Delivered
Right side: Start Mileage
And Every time I stopped I marked the mileage down.
and Ending Mileage to layover Location.
iF YOU USE THE STAN DARD MILEAGE RATE YOU CANNOT DO WHAT YOU HAVE BEEN DOING IN THE PAST.
YEAR ENDING MILEAGE IS: xxxxxxxx
YEAR BEGINGING MILEAGE WAS: -xxxxxxxx
TOTAL MILEAGE: xxxxxxxx
I know we have had some disagreements before, but I now admit I was incorrect.
Frank’s Tax and Business Service
120 York Rd
Kings Mountain, NC 28086-3151
(704) 739-4039 Fax: (704) 739-3934
e-mail: [email protected]
Web Site: File Your Return Online
Franklin Katz, ATP, PA, PB,
Providing Professional Accounting Services and Income Tax Preparation
Circular 230 Disclaimer – Any tax advice in this communication (including any attachments) is not intended or written to be used, and cannot be used, by any taxpayer for the purpose of avoiding related
penalties under the Internal Revenue Code or (2) promoting, marketing or recommending to another party any transaction or tax
related matters addressed herein.
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