Magnet Signs and/or Car Wrap Tax Deduction

Magnet Signs and/or Car Wrap Tax Deduction

Investor · Cedar Park, TX · Member since 2014 · 317 posts · 74 votes

Hello I have a question concerning car magnet signs and car wraps as a tax deductible expense.

I currently have car magnet signs placed on my automobile. I have those signs on my car 24/7. These signs are on my car when the car is used for business (like driving to a meeting with a seller) and for personal use (like going to the grocery store). Since the signs are always on my car, can I write off everything such as all milage and expenses related to the upkeep of the car as a travel expense or am I still required to keep personal millage and business milage on a milage log separately and am only allowed to take the standard millage deduction? 

I am thinking I could write everything off as a advertising expense but I also realize my thinking could totally wrong. I am looking for a new CPA otherwise I would ask the CPA.

Also, does it make a difference if it is car magnets or a car wrap done to my car if I can write it off as an advertising expense?

Thank you in advance for your assistance.

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  • CPA · Raleigh, NC · Member since 2013 · 1k+ posts · 2k+ votes
    9y

    @Shawn C. the cost of adding the advertising to the car is deductible (signs, labor, etc) but just because you add advertising to the car does not make the use of the car a deductible business expense.

    Here's a tax court case where a dental practice was challenged by the IRS on this very issue. The IRS won.

    http://www.ustaxcourt.gov/InOpHistoric/WILLOCKC.TCM.WPD.pdf?_ga=2.242373953.2119717688.1502723604-1431854774.1498610952

  • Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    9y

    The OP can deduct .55 a mile for business mileage. Everything should be documented. My S corp writes a check to me monthly for mileage reimbursement. The money is not free. When the car wears out it must be replaced:)

  • Investor · Cedar Park, TX · Member since 2014 · 317 posts · 74 votes
    9y

    @Brandon Hall I was afraid of that, Thank you for commenting and for the link. I really appreciate it. So I guess to have a vehicle to write everything off it would have to be purchased or leased through the business. Would that be correct? I am not just going to purchase a vehicle, I am just trying to understand the difference between the two.

    @John Thedford Thank you for commenting as well.

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