Cost of a leased vehicle

Forum|Forum|3 years ago
March 2, 2023
1 reply
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Hi,

I have a capital lease which I am trying to add to my assets. What I can't figure out is if the cost of the car is the adjusted capitalized cost or if the cost of the car is the residual value? Also I didn't buy the car at the end of the lease but instead turned it in for a new one, and I had a gain of $2,064 which was applied to the new lease I got.

TurboTax Business Windows

leeloo

Is the gain from the depreciation of the down payment?

Leasing a Car

If you lease a car, truck, or van that you use in your business, you can use the standard mileage rate or actual expenses to figure your deductible expense. This section explains how to figure actual expenses for a leased car, truck, or van.

Deductible payments.

If you choose to use actual expenses, you can deduct the part of each lease payment that is for the use of the vehicle in your business. You can’t deduct any part of a lease payment that is for personal use of the vehicle, such as commuting.

You must spread any advance payments over the entire lease period. You can’t deduct any payments you make to buy a car, truck, or van even if the payments are called “lease payments.”