ACCOUNTANT EXPLAINS: Should You Buy, Lease or Finance New Car?

Should you buy or lease a car as a business vehicle? I've asked myself this question sometimes because if you are self-employed or have a small business then you can take advantage of what is known as the vehicle tax deduction.

The vehicle tax deduction allows you to write off your car, your SUV, your truck, and whatever you may drive for business purposes whether you decide to lease vs buy your car.

Timestamps:
Intro (0:00)
Buying vs Leasing a Car (1:40)
Vehicle Tax Deduction (5:00)
Two Methods to Write off a Business Vehicle (6:46)
Factor #1 (9:02)
Factor #2 (10:36)
Factor #3 (14:12)
My Personal Decision (15:04)
Bonus Tip (16:01)

In this video, what I do is give you a solid guide, so that you run the numbers and compare for yourself if you should buy vs lease a car. I'll go over:
- How to Qualify for Vehicle Tax Deduction
- The Two Methods Deduct a Vehicle
- Most Important Factors to Consider when lease vs buy a car
Along with some math and calculations along the way.

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Disclaimer: The information provided in this video is for informational purposes only and is not meant to take the place of professional legal, accounting, or financial advice. If you have any legal questions about this video or the subjects discussed, or any other legal matter, you should consult with an attorney or tax professional in your jurisdiction (i.e. where you live).

[vikram.SumerSingh]

Finally a video that makes sense and goes through actual facts and rules. Loved it & Subbed.

[singwritedance]

This was very informative and well done. Thank you!

[antoinestephensonphotograp]

Great content. I would love to give a tip. If you loosen your tie you can push the lapel mic down into the knot and hide it from hanging over the top. Look at the sports talk shows. They typically hide it In the tie.

[pech_wake_day]

Buying both my vehicles to be able to run my business. Yes they will be used for some personal use but mainly to operate the biz. Thanks guys, best FREE info on YOUTUBE.

[bebin]

It depends on what you're wanting to do with the vehicle - are you buying in your own name then "renting" or leasing it to your biz? Is it purchased in the biz name? If you lease you can't use section 179 with accelerated depreciation as you don't own it (from my understanding). You have to buy it outright (cash or financing) to take advantage of that. People like to lease because they can afford a lot more car than they could if they financed it. You also know exactly how much it's going to cost you to own the vehicle. You can still pay off the lease at any time and sell it if you can benefit from a high value market (like we are experiencing now). You can also buy it at the end of the lease and keep it if you like it that much. So leasing is no different than a loan - you don't own a vehicle you have a loan on with a bank. The other nice thing about leasing is you don't pay all the sales tax and you don't pay it all up front. You only pay tax on each payment and you pay on the amount you are using. A lease also doesn't show up as a huge debt on your credit score - it just shows up as a payment. Leasing doesn't really make sense for an individual, but through a biz it can be very useful. If you want section 179 and bonus depreciation you need to buy (finance). If the vehicle is over 6, 000 pounds you def want to buy.

[UrbanBDKNY]

Amazing video. Me and my wife have been leasing for 9 years but cars have gotten so expensive and interest rates that it doesn’t make sense to lease again. The same car we have now would be 18, 000 more in just 3 years

We have an option to buy so we may buy the car and deduct the interests and gas etc on that vehicle until these companies get back down to earth with prices and leasing options

[alexmendez]

If I had a rental or Fleet business definitely going the lease route. Saves you a ton of headaches.

[barberdannycutz]

So much value in this video thank you so much I greatly appreciate it liked and subscribed!

[MTLIFE]

Great video Sean. I'm eyeing the model S for my business car maybe in about 2 years.

[heavenavorque]

Good info. Thank you.
You forgot to mention recapture if vehicle is disposed.

[jodahamunra]

This was very informative. For me being a "Car Guy", I would purchase if the car was to be kept for my
personal Collection. If the car was just something I wanted to just drive to experience... I would lease.
As for the methods of depreciation, I prefer the Actual Expense method... #Hotep

[millonariosconcheys]

Always great video, The next video how to buy a car under llc

[davidrivera]

I am interested in getting a used truck under 6K lbs to use for both personal and business. What is the best bank loan for a new startup I should consider, my business has not launched yet, but this is my first step and I need this to move into my primary business entity land ownership for rental properties. I have a budget of $30K for the vehicle and will use the SBA for my Veteran Loans and grants. Thanks for any advice you can share.

[bsqktmo]

Bro you look just like the guy who does the aggressive dance offs against the green screen " bust it out 🎵 bust it out 🎵",

[spirokalu]

Thanks for the tips! Question: I currently have a mobile business, own my vehicle (paid off), and use the standard mileage deduction. My CPA said once I chose this method I can't switch to expense method. I plan on getting another vehicle for 100% business. In the video you said if I lease, can I write off lease payments as well as the standard mileage. Can I write off the insurance payments as well? Thanks

[DonRonLyfeStyles]

So you can use the actual expense method and use the depreciation bonus in one tax year?

[lHurtYourFeeIings]

He forgot to mention the advanced subject, Lease Inclusion Amount. You need to reduce the lease deduction if the car value is up to certain annual limit. This prevents business owners from deducting a Ferrari lease.

[livewithaglobalmind]

What if I buy a vehicle before I started my business but I’ll write it off text time business, mileage, and least an insurance

[Justin-qfip]

Great content topic! In my opinion, buying and leasing seems feasible depending on your circumstance and budget.

[LetHimCook_Entertainment]

When you buy the business vehicle, does it have to be bought with business revenue? Or can I personally get a loan