BMW Tax Advantage
At BMW of Grand Blanc, we want to help you save as much money as possible on a brand-new luxury vehicle, especially if you're using it for business. Continue reading to find out more about BMW tax deduction conditions. Who knows, you might find some additional income in your bank account come tax season!
What Is a BMW Tax Advantage?
Is your company considering purchasing a new BMW X5, X6, or X7? If so, you may be able to save even more money in taxes. Because each of these vehicles has a GVWR (Gross Vehicle Weight Rating) greater than 6,000 pounds, the first year of ownership may be the best time to take advantage of the maximum depreciation allowance. There are certain exceptions to this rule, though.These BMW premium vehicles are "heavy SUVs" because of their Gross Vehicle Weight Ratings—the vehicle's maximum weight when fully loaded with people and/or goods. As a result of this classification, they can serve as "transportation equipment" for your company. To you, what does this mean? You and your organization will save a lot of money!
What Are the BMW Tax Advantage Requirements?
It's straightforward to qualify for BMW tax deductions. All you have to do is the following:- Purchase a BMW luxury model with a gross vehicle weight rating of over 6,000 pounds, such as the BMW X5, X6, or X7.
- This car must be purchased before December 31, 2022.
- This luxury automobile must be used exclusively for work purposes.
What Will My Savings Be?
You may be eligible for increased first-year depreciation on qualified automobiles, such as the BMW X5, X6, or X7, under Section 179 and 168(k) of the Internal Revenue Code. That means you can deduct 100% of the depreciation on your business's transportation equipment! What does this mean in comparison to other non-eligible vehicles? Consider the following.
If you acquire a BMW X7 for business usage, you can deduct 100% of the vehicle's depreciation. This can amount to more than $90,000! Other luxury automobiles that do not qualify may qualify for a deduction of only 20%, or less than $20,000. 1
However, that is not all! You can continue deducting for as long as you use your BMW for business purposes. Depreciation deductions on luxury automobiles may be carried forward until the vehicle is completely depreciated or sold. Consider how much money you'll save after the first year:
- Second Year: $16,100
- Third Year: $9,700
- $5,760 for Each Subsequent Year
Find Out More About BMW Tax Deductions today!
If you want to make money for your business just by driving a fantastic BMW SUV like the X5, X6, or X7, contact a member of the BMW of Grand Blanc staff now! Not only do we have all of these attractive and powerful models in store, but our specialists can also assist you in finding a financing plan that is ideal for your business.
Owners of businesses in Grand Blanc, Fenton, and Saginaw, Michigan, can contact our staff for additional information today!
TAX DEPRECIATION COMPARISON
Three comparisons are provided below that show the tax benefits for company owners who purchase a new BMW X5, X6, or X7 before December 31, 2021. To learn how this information can be applied to your specific business situation, please check with your tax specialist.
$66,750 BMW X5 VS $66,750 LUXURY CARTotal allowable depreciation for 1st year of ownership* |
$78,300 BMW X6 VS $78,300 LUXURY CARTotal allowable depreciation for 1st year of ownership* |
$92,600 BMW X7 VS $92,600 LUXURY CARTotal allowable depreciation for 1st year of ownership* |
| BMW X51 100% Depreciation $66,750 |
VS |
Luxury Car2 27% Depreciation $18,200 |
BMW X61 100% Depreciation $78,300 |
VS |
Luxury Car2 23% Depreciation $18,200 |
BMW X71 100% Depreciation $92,600 |
VS |
Luxury Car2 20% Depreciation $18,200 |
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.
*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, 2022.
**BMW X5/X6 shown fully depreciated in Year One.
***Luxury car depreciation can continue year two at $16,400, year three at $9,800, and subsequent years at $5,860 until the vehicle is fully depreciated or sold.
***With Gross Vehicle Weight Ratings (GVWR) of more than 6,000 pounds, these BMW models are classified as “heavy SUVs.” Gross Vehicle Weight Rating (GVWR) is the manufacturer’s rating of the vehicle’s maximum weight when fully loaded with people and cargo.
†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, 2021.