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Thread: What's a trade in worth today?

  1. #21
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    If it has a business justification the interest on the debt is deductible.

    We bought ours originally for personal pleasure use. We never intended for it to be used for business purposes. But after one year of traveling and seeing all the products we could produce in our factory, including electric power outlets, picnic tables, fire rings, charcoal grilles, etc. we started using the coach to bring us and the displays to trade shows. (www.jamestownadvanced.com) Simultaneous with that I started doing seminars on behalf of a major customer and we used the coach (or my plane) to carry the audio visual stuff and all of the literature and product cutaways for the seminars. Between the two business purposes we were actually using the coach almost 30,000 miles a year for business. The IRS has never taken issue with any of our deductions taken for the coach, which not only included depreciation, but every drop of fuel and every dollar spent on maintenance. Having a business purpose for a coach is like getting a 35% discount on everything associated with owning and operating a coach.

  2. #22
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    The interest is deductible as a second home whether there is a business use or not.

  3. #23
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    From time to time we engage in private and forum discussions on coaches, their value, and details relating to evaluating one. Those of us that are interested cruise through the various sites from time to time just to see what's out there and likely to measure what is being offered for sale against a coach we own or are contemplating.

    Today I ran across a coach that I think either has a misprint for the selling price or I am way off base in my thinking of values.

    http://www.prevost-stuff.com/1995Pre...CoachSales.htm

    To my way of thinking this coach would be a steal. Assuming it was in decent shape as advertised, the price appears well below what I would have expected. I recognize the coach needs work. The belts are missing from the OTR compressor so something is wrong there and that could be expensive. I don't know the age or condition of the tires, air bags, batteries, its maintenance history, if it smells like the bottom of an ashtray, and how clean it really is, inside and out. But at that price a buyer could buy tires and all the other things necessary to bring it into a first class status as far as mechanical reliability and still have pocket money to buy a lot of fuel compared to prices on similar coaches.

    Maybe the market still has not hit bottom.

  4. #24
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    That does seem cheap. Maybe its going to be the same as the housing market. They say here north of Tampa that we are still a ways from the bottom.

  5. #25
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    Another thread referred to Prevosttrader.com. Their front page has a couple of '94 models around that price point, so maybe that is just where it is...

  6. #26
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    Panterra Coach has a 1997 Marathon for $119,000.00.


    JIM

  7. #27
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    I guess if those prices are the new reality the market still is a buyer's market because those prices don't come close to reflecting the real value of a coach that still has 80 to 90% of its life remaining.

  8. #28

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    Quote Originally Posted by travelite View Post
    Hi Karl,

    This is how it's done:

    http://marathoncoachsales.com/news/B...on_9_30_10.php

    In other words, by the end of the third year the coach is 100% depreciated. If your business is in a 35% tax bracket and you bought a 1.8M coach, you get 630K back compliments the IRS. Then, at the end of three years, you put the coach on the market for 1.17M and you're three year ownership cost was zilch. Repeat as necessary.

    This is why you see a lot of 3 year old coaches on the market.

    Admittedly my explanation is somewhat of a simplification, but you get the gist.

    Regarding pre-owned units wouldn't the use of the vehicle as a mobile "office" to conduct meetings/conference and so forth meet the 179 deduction criteria? I know I'm asking an accountant question but not sure if some of you have already vetted this question.

  9. #29
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    Quote Originally Posted by gershwin View Post
    Regarding pre-owned units wouldn't the use of the vehicle as a mobile "office" to conduct meetings/conference and so forth meet the 179 deduction criteria? I know I'm asking an accountant question but not sure if some of you have already vetted this question.
    There are very important limitations to the 179 deduction, and business use depreciation of the motorcoach for tax purposes in general. For instance, you may not take a 179 deduction in a given year for more than the business for which the deduction is taken makes in that year. EG, a shell company with $50k in receipts isn't going to cut it on the full amount of 179 deduction of $500k. You may carry forward residual deduction which is income limited in a given year however.

    With the amount of money you are talking about here, it is well worth the time to "vet" with a competent tax advisor. He or she will run you through the ringer on the legitimacy of business use for which you will be happy should the IRS come knocking down the road.

    There is also a bonus depreciation acceleration allowed in 2010 and I believe again in 2011 in addition to the 179. If memory serves, this is limited to new equipment placed in service however whereas the 179 may be new or used. Again, tee up the knowledgeable tax advisor....

  10. #30

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    Quote Originally Posted by GDeen View Post
    There are very important limitations to the 179 deduction, and business use depreciation of the motorcoach for tax purposes in general. For instance, you may not take a 179 deduction in a given year for more than the business for which the deduction is taken makes in that year. EG, a shell company with $50k in receipts isn't going to cut it on the full amount of 179 deduction of $500k. You may carry forward residual deduction which is income limited in a given year however.

    With the amount of money you are talking about here, it is well worth the time to "vet" with a competent tax advisor. He or she will run you through the ringer on the legitimacy of business use for which you will be happy should the IRS come knocking down the road.

    There is also a bonus depreciation acceleration allowed in 2010 and I believe again in 2011 in addition to the 179. If memory serves, this is limited to new equipment placed in service however whereas the 179 may be new or used. Again, tee up the knowledgeable tax advisor....
    Yes you are right the 179 deduction form is for preowned or "not new" equipment. Was going to speak with a TA just wanted to do a little root'n around w/ like kind individuals before posing the "maybe" question to him.

    thank you...

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