BMW Tax Deduction Qualifications
Driving a BMW is all about luxury. Hitting the streets of Spokane, Spokane Valley, or Liberty Lake, Washington, is just better in a luxury vehicle, whether you’re cruising down Division Street in search of great eats or using it as your business vehicle. But did you know your BMW model may qualify you for a tax deduction? A brand-new luxury car and tax advantages? What’s not to love about that?
At BMW of Spokane, we want to help you save as much as possible on a brand-new luxury vehicle, especially if you’re using it for business. To learn more about BMW tax deduction qualifications, read on. Who knows, you may find some extra cash in your bank account come tax season!
What Is a BMW Tax Advantage?
Are you thinking about purchasing a new BMW X5, X6, or X7 for your business? If so, you may qualify for extra tax savings. Since each of these models has a Gross Vehicle Weight Rating (GVWR) over 6,000 pounds, they’re potentially eligible for full depreciation during the first year of ownership. However, to qualify, they must be used solely for business purposes.
Because of their Gross Vehicle Weight Ratings—the vehicle’s maximum weight when fully loaded with people and/or cargo—these BMW luxury models qualify as “heavy SUVs.” This designation allows them to become “transportation equipment” for your business. What does this mean to you? Incredible savings for you and your company!
How Do I Qualify for a BMW Tax Advantage In Spokane, WA?
Qualifying for BMW tax deductions is simple. Here’s all you’ll need to do:
- Purchase a BMW luxury model with a GVWR over 6,000 pounds: the BMW X5, the X6, or the X7.
- You must purchase this vehicle before December 31, 2020.
- You must use this luxury vehicle for 100% business purposes.
It’s that easy to receive huge tax breaks for your company!
How Much Will I Save?
Under Section 179 and 168(k) of the Internal Revenue Code, you’re allowed to receive additional first-year depreciation for eligible vehicles, like the BMW X5, the X6, or the X7. That means you’ll be able to deduct 100% of its depreciation for your company’s transportation equipment! So, how does this compare with other non-eligible vehicles? Let’s take a look.
If you decide to purchase a BMW X7 to use as your company vehicle, you can deduct 100% of its depreciation. That can equate to over $90,000! With other luxury vehicles that don’t qualify, you may only be able to deduct 20%, less than $20,000.1
But that’s not all! You can continue deducting throughout the years you use your BMW for your company. Luxury car depreciation deductions can continue until the vehicle is fully depreciated or sold. Let’s take a look at how much you’ll save after the first year:
- Year Two: $16,100
- Year Three: $9,700
- All Subsequent Years: $5,760
When you own a business, this is a great asset. You can put the money you save by driving a BMW into your company, allowing it to thrive even more.
Learn More About BMW Tax Deductions In Spokane, WA Today!
If you’d like to earn money for your business just by driving an incredible BMW SUV, like the X5, the X6, or the X7, then speak to a member of the team at BMW of Spokane today! Not only do we have all these stylish and capable models in stock, but our experts can also help you find a finance plan that fits your company perfectly.
Business owners in Spokane, Spokane Valley, and Liberty Lake, WA, can reach out to our team for more information now!
Individual tax situations may vary. The information presented was accurate at time of publishing. Federal rules and tax guidelines are subject to change. Consult your tax advisor for complete details on rules applicable to your business.
Please consult with your tax professional in order to determine how this information can be applied to your individual business situation.
1 Comparisons based on Section 179 and 168(k) of the Internal Revenue Code, which allows for additional first year depreciation for eligible vehicles and reflects figures for owners who purchase vehicles for 100 percent business use and place vehicles in service by December 31, 2020.
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