Small business, new/old truck deductions

DFRI

I have my own landscape maintenance company, and work alone. On 9-1-06 I purchased a new 2006 4x4 pick-up truck. $23,400 plus tax.
I kept the old truck, and primarilly used the old one to finish the season out, but ocassionally went back and forth between the two.

Question 1. Can I use the mileage deduction for the WHOLE year on the old truck?? My accountant said he was going to use the mileage deduction up till 9-1. Why couldn't he take the full mileage for the year?

2. He said he was going to take the full price of the truck, using that as the section 179 deduction.

Thanks for any help.

DFRI

Anybody?? If not, does anyone know of a message board strictly about taxes and deductions?

Murdina

There are various issues here. Do you own the trucks personally and claim a deduction for their running costs against your salary from the company? If so did your accountant advise you to do this rather than buy them through the company? The tax position is of course quite different in each scenario and would then be affected by private use of the truck. If I have understood you correctly you are running them privately and claiming a deduction of 40p a mile or whatever? If you can clarify I will try and advise further. If you bought the truck through the company then it would qualify for capital allowances, all the running costs could be borne by the company etc but if there were any private use you would pay tax and NI on a benefit. My gut feel is that would have been a better option - did you discuss this with him and ask him for some calculations?

DFRI

I own both trucks under the company name. And claim the deductions against the gross sales. Have always used the mileage deduction against the old truck each year.
I hope this clarifies things. Thanks for the help.