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[RKB]

Vehicles that have a GVWR over 6,000lb are eligible for a $25,000 tax deduction the year you buy it, if the vehicle is used for work. The Rubicon XR has a GVWR of 6,100lb. I am 1099 for both streams of income that I have. Write off’s are key to not getting your mouth torn out year in and year out by Uncle Sam.

Question for you; I met with my CPA last week and ask him about this. I have a good income aud it is all 1099. I travel some to see my customers and drive about 17,000 miles a year for business. He said over the course of 5 years or so I am better taking the milage deduction of 58 cents or whatever it is and it is going up too and just forget about doing the 6,000lb GVWR deduction. Does this sound correct?

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[Jeeppaul91]

I meant a larger depreciation percentage when used for business.

I gotcha, Im not sure what those numbers look like. I‘m not interested in PHEV‘s yet, maybe some day down the road I’ll switch over when the tech gets better and there’s more infrastructure to support charging stations at every corner store.

 

[rkeen81]

Question for you; I met with my CPA last week and ask him about this. I have a good income aud it is all 1099. I travel some to see my customers and drive about 17,000 miles a year for business. He said over the course of 5 years or so I am better taking the milage deduction of 58 cents or whatever it is and it is going up too and just forget about doing the 6,000lb GVWR deduction. Does this sound correct?

I would say that he is correct. You would have a higher cumulative deduction over the 5 year term than you would for just the one time $25,000 given the avg mileage and using a static .58c over the 5 year term.

 

[Positive Altitude]

Vehicles that have a GVWR over 6,000lb are eligible for a $25,000 tax deduction the year you buy it, if the vehicle is used for work. The Rubicon XR has a GVWR of 6,100lb. I am 1099 for both streams of income that I have. Write off’s are key to not getting your mouth torn out year in and year out by Uncle Sam.

There is a $7,500 tax credit on the electric models, but keep in mind that is only good until the 200,000 electric unit is sold. That piece of info seems to get left off when people are giving out advice. I didn't think you were talking about the tax credit so I was curious what you meant, didn't want to miss an opportunity. For the 179 deduction you are talking about make sure you read the guidelines around that to qualify. The vehicle needs to be titled to the business, if your personal name appears on the title you wouldn't qualify for the full 25K. If the jeep isn't used 100% for business you can still claim part of the deduction as long as it is used more than 50% for business. Be careful with the fine print on those deductions if you want the full deduction, I total get the need for write offs but I find CPA's dont always explain the little things that can bite us in the ass... and if not obvious I work at a CPA firm
Good Luck and I hope your new jeep comes in time. I just ordered my first jeep ever and hoping it gets here before my September beach trip - no deductions for me

 

[RKB]

There is a $7,500 tax credit on the electric models, but keep in mind that is only good until the 200,000 electric unit is sold. That piece of info seems to get left off when people are giving out advice. I didn't think you were talking about the tax credit so I was curious what you meant, didn't want to miss an opportunity. For the 179 deduction you are talking about make sure you read the guidelines around that to qualify. The vehicle needs to be titled to the business, if your personal name appears on the title you wouldn't qualify for the full 25K. If the jeep isn't used 100% for business you can still claim part of the deduction as long as it is used more than 50% for business. Be careful with the fine print on those deductions if you want the full deduction, I total get the need for write offs but I find CPA's dont always explain the little things that can bite us in the ass... and if not obvious I work at a CPA firm
Good Luck and I hope your new jeep comes in time. I just ordered my first jeep ever and hoping it gets here before my September beach trip - no deductions for me

Thanks for sharing this good information.

 

[Positive Altitude]

Thanks for sharing this good information.

Not a problem, the guidelines are always changing so I am always trying to keep up. All business use of the vehicle (in a self employed situation) are deductible expenses whether you decide to go with actual or mileage varies on the individual and the biggest benefit for sure. Even under 6,000 pds I believe you can get up to 10k deduction. Just keep good business logs.
I see you have a Lexus GX and FJ. We have (had) both as well - son has the FJ and a tree totaled my GX, best car to date I have ever had - miss it, but looking forward to my new jeep

 

[Positive Altitude]

I would say that he is correct. You would have a higher cumulative deduction over the 5 year term than you would for just the one time $25,000 given the avg mileage and using a static .58c over the 5 year term.

For the final 6 mos of 2022 the business mileage for business travel will be 62.5c - FYI

 

[JWWrangler]

There is a $7,500 tax credit on the electric models, but keep in mind that is only good until the 200,000 electric unit is sold. That piece of info seems to get left off when people are giving out advice. I didn't think you were talking about the tax credit so I was curious what you meant, didn't want to miss an opportunity. For the 179 deduction you are talking about make sure you read the guidelines around that to qualify. The vehicle needs to be titled to the business, if your personal name appears on the title you wouldn't qualify for the full 25K. If the jeep isn't used 100% for business you can still claim part of the deduction as long as it is used more than 50% for business. Be careful with the fine print on those deductions if you want the full deduction, I total get the need for write offs but I find CPA's dont always explain the little things that can bite us in the ass... and if not obvious I work at a CPA firm
Good Luck and I hope your new jeep comes in time. I just ordered my first jeep ever and hoping it gets here before my September beach trip - no deductions for me

Are there any other catches to the $7,500 tax credit? I currently have a 2020 Sahara and am considering ordering a 2023 4xe next week. The tax credit helps to make the upgrade possible, but I am wondering how realistic that credit and its amount is for everyone who orders a 4xe.

 

[Positive Altitude]

Are there any other catches to the $7,500 tax credit? I currently have a 2020 Sahara and am considering ordering a 2023 4xe next week. The tax credit helps to make the upgrade possible, but I am wondering how realistic that credit and its amount is for everyone who orders a 4xe.

I had considered ordering the 4xe with the same logic that the tax credit would cover the up cost, ultimately I decided against however I did check the IRS site to make sure the jeep was an eligible vehicle and it was. Just remember the credit will start to phase out after a manufacturer sells 200,000 qualifying vehicles and eventually phases out altogether. The credit is non refundable, so only good up to the amount of your tax liability or 7,500 whichever is less. Since the credit reduces your tax due you should receive back any withholdings from your w2 or estimated tax payments. So based on your personal taxes and potential tax liability will determine the exact amount of the credit you’d receive. For instance if the tax due based on your income is say 10,000 then the credit reduces the amount due to 2,500. If your withholdings are 10k then you’d get a 7,500 refund. But if your withholdings were 5000 you’d only get a 2,500 refund.
its late so I hope that makes sense.

 

[RKB]

Not a problem, the guidelines are always changing so I am always trying to keep up. All business use of the vehicle (in a self employed situation) are deductible expenses whether you decide to go with actual or mileage varies on the individual and the biggest benefit for sure. Even under 6,000 pds I believe you can get up to 10k deduction. Just keep good business logs.
I see you have a Lexus GX and FJ. We have (had) both as well - son has the FJ and a tree totaled my GX, best car to date I have ever had - miss it, but looking forward to my new jeep

Yes I just sold the FJ not long ago it was a 2011 with a lot of miles and got $27K for it. Decided to sell because I had too many vehicles and wanted to pocket the cash. The GX is great I have it setup for off road with 2 inch lift and 33's ready to go on it now. 100K miles on it and it. runs great. Not sure I will keep it if I get a Jeep; it just crazy how expensive the Jeeps are getting!

 

[Positive Altitude]

Yes I just sold the FJ not long ago it was a 2011 with a lot of miles and got $27K for it. Decided to sell because I had too many vehicles and wanted to pocket the cash. The GX is great I have it setup for off road with 2 inch lift and 33's ready to go on it now. 100K miles on it and it. runs great. Not sure I will keep it if I get a Jeep; it just crazy how expensive the Jeeps are getting!

The high cost for a decent used car is why I decided to go new, husband not at all thrilled with my choice but I was looking at another FJ, low miles but still 10 yrs old and they were asking 35k. If I have to pay that much for something used I’ll add 20 and get something new. I’m driving my dads old Lexus while waiting on the Jeep, 20 yrs old with 355k miles. Runs great. Good luck with your next purchase.

 

[RKB]

The high cost for a decent used car is why I decided to go new, husband not at all thrilled with my choice but I was looking at another FJ, low miles but still 10 yrs old and they were asking 35k. If I have to pay that much for something used I’ll add 20 and get something new. I’m driving my dads old Lexus while waiting on the Jeep, 20 yrs old with 355k miles. Runs great. Good luck with your next purchase.

Lexus GX seem to run forever; at 355K you all have gotten your money worth out of it. Enjoy you Jeep when you get it; and I was also looking at used Jeeps and decided it is better to go new also. I had same reasoning I said take another $20k and get one 5-6 years newer with factory Warranty.

 

[DurangoWino]

I didn't order a one touch, but I did order a Granite Crystal Jeep. According to JC as of yesterday I still don't have a VIN. Quite a few folks that ordered after me already have VINs. I hope the Granite Crystal paint isn't causing delays. I saw where a few folks said the dealer called them back and told them they had to change their order to a different color. Not sure what's going on with Granite Crystal paint right now. Wish I knew.

Anyone with a Granite Crystal 2023 order have a VIN yet?

Yes I ordered Granite Gray Rubicon 4-door and got a VIN in mid-June. I heard someone in an earlier thread got a call from Jeep to change color, but nothing from Jeep or my dealer to date.

 

[JWWrangler]

I had considered ordering the 4xe with the same logic that the tax credit would cover the up cost, ultimately I decided against however I did check the IRS site to make sure the jeep was an eligible vehicle and it was. Just remember the credit will start to phase out after a manufacturer sells 200,000 qualifying vehicles and eventually phases out altogether. The credit is non refundable, so only good up to the amount of your tax liability or 7,500 whichever is less. Since the credit reduces your tax due you should receive back any withholdings from your w2 or estimated tax payments. So based on your personal taxes and potential tax liability will determine the exact amount of the credit you’d receive. For instance if the tax due based on your income is say 10,000 then the credit reduces the amount due to 2,500. If your withholdings are 10k then you’d get a 7,500 refund. But if your withholdings were 5000 you’d only get a 2,500 refund.
its late so I hope that makes sense.

Thanks for that info. I am researching my "tax liability" amount from tax returns. I am not a tax expert, for sure and trying to determine which line to look for. I am around that 10K mark you mentioned. Is 10K the minimum amount to get the $7,500 incentive or would it be $7,500 in taxes to get it?

 

[JWWrangler]

I had considered ordering the 4xe with the same logic that the tax credit would cover the up cost, ultimately I decided against however I did check the IRS site to make sure the jeep was an eligible vehicle and it was. Just remember the credit will start to phase out after a manufacturer sells 200,000 qualifying vehicles and eventually phases out altogether. The credit is non refundable, so only good up to the amount of your tax liability or 7,500 whichever is less. Since the credit reduces your tax due you should receive back any withholdings from your w2 or estimated tax payments. So based on your personal taxes and potential tax liability will determine the exact amount of the credit you’d receive. For instance if the tax due based on your income is say 10,000 then the credit reduces the amount due to 2,500. If your withholdings are 10k then you’d get a 7,500 refund. But if your withholdings were 5000 you’d only get a 2,500 refund.
its late so I hope that makes sense.

Thanks for that info. I am researching my "tax liability" amount from tax returns. I am not a tax expert, for sure and trying to determine which line to look for. I am around that 10K mark you mentioned. Is 10K the minimum amount to get the $7,500 incentive or would it be $7,500 in taxes to get it?

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