|
NE Iowa | Up until mid-2018, I worked a fulltime job in a town 25 miles away along with farming. I have a pickup I drove daily to work, as well as used for some occasional farm activity (mostly getting parts, running errands, looking at equipment, etc). The majority of its miles were not farm related. So for many years, I have simply kept track of the miles I did use it for farm activities and deducted the fed mileage rate off my income taxes. My farm is a sole proprietorship - no LLC, partnership, etc.
From mid-2018 and forward, however, farming will be my primary income source. I will continue to track farm vs. personal mileage in 2019, with the idea that at the end of the year I will take whichever route is most tax favorable - either continue to just report the mileage or to take all expenses related to this truck (gas, maintenance, insurance, license tags, etc.) as a farm expense. Pretty sure the mileage reimbursement will end up higher. However, can I transfer the 'ownership' of this truck from 'personal' to 'farm' as though my farming operation 'purchased' the truck from my personal assets and use that as a depreciable asset? I would do this at some reasonable current market value of the truck. This truck has never been shown as an asset on my farm books. I am guessing I can't do this as the farm really isn't a seperate entity in the governments eyes. But doesn't hurt to ask.
I will ask my tax preparer, but thought I would ask the folks here, first. Seems as though answers here can come with a little better knowledge of farm taxes than my guy seems to exhibit at times. I know, that means I need a new tax guy - probably headed that direction, just not there yet.
Thanks. | |
|
Farm tax question - pickup truck
