Q. I plan to lease a car for business travel this year. Is there a limit on the amount I can deduct? A.H., Barnegat, N.J.
A. Sort of. Although your business may deduct the full amount of the lease payments, you’re required to add back an “inclusion amount” for vehicles priced over a specified level. The inclusion amount is based on IRS tables. This tax rule effectively substitutes for the “luxury car” caps limiting deductions for purchased vehicles.
Tip: The IRS recently released the new tables. For 2009, the inclusion amount applies to vehicles costing more than $18,500. (IRS Revenue Procedure 2009-24)
- Small Business Tax Deduction Strategies No matches