The Tax Benefits of a Cadillac Lease
A new luxury vehicle is one of life’s great pleasures. However, in the right hands it can also be an eminently practical choice. After all, if you’re using your vehicle for business, your you can reap significant tax benefits from your Cadillac lease.
Your Cadillac Lease: Three Tax Questions
We would caution that the following is the advice of a Highland Cadillac dealer, not of a tax professional. Each use case has its own tax considerations, and these should be discussed with your accountant or tax professional.
1. What Cadillac Vehicle Expenses can be Written off?
You have many different options to write off business expenses on a new Cadillac model, whether via the standard mileage rate or through itemized deductions. In the latter case, the following are among eligible expenses:
- Fuel
- Maintenance and repairs
- Parking expenses
- Tolls
- Fees associated with documents, registration, vehicle title, and the like
- The payments on your lease or loan
- Depreciation
2. From a Tax Standpoint, is it Better to Buy or Lease a New Cadillac Car?
Leasing brings with it certain practical considerations — not least of which are your mileage and possible wear and tear — atop the usual tax concerns. Chief among these is the depreciation deductible, which is $4,200 for a leased vehicle or $10,000 depreciation deduction for one that is purchased; your Cadillac dealer will help you weigh your options.
3. Are there any Caveats?
Three particular issues call for a bit of caution.
- You may not deduct expenses reimbursed by your employer
- You may not write off any personal use; instead, your business deductions should be prorated based on the ratio of business to personal driving
- The SALT deduction cannot be used for multiple tax liabilities
A bit of back-of-the-envelope math will help you determine which approach best suits your business and your financial goals.
Final Thoughts on Your Cadillac Lease
A Cadillac lease from LaFontaine Cadillac can be customized to a range of scenarios, including business and fleet use. However, in much the same way that each lease is different, each individual’s — and business’s — tax considerations will likewise vary. Discuss your options with your dealer and your accountant alike, and whichever avenue you choose to take, be sure to document any applicable deductions carefully and consistently.
A thought in closing: while long-term planning is key to the success of any business, the benefits of saving in the here and now also matter. To that end, ask your Cadillac dealer about available Cadillac lease offers, commercial programs, and any other questions that may arise.