PDA

View Full Version : Work truck


lone wolf
10-24-2010, 08:40 AM
I been in business for 5 years. I have a 20' white/green enclosed trailer. I drive my green personal 3/4 ton.

Question: I can buy a white 3/4 ton pick-up. I would like to keep my personal truck, personal. A white truck I think would make me look better. You can't think of the double maintenance costs. My truck now is going through a oil change a month. The only "extra" is licence tabs. All other maintenance is split inbetween both trucks.

The bad is this white 1 is 2 wheel drive. I am kinda moving out of plowing anyway. I still plow, but I can take my green 4x4.

Should I have 2 trucks? 1 personal, 1 work?

93Chevy
10-24-2010, 08:46 AM
I wish I had two trucks. Always good to have a backup truck.

Figure out your expenses and cash flow and go from there.

mbrew
10-24-2010, 11:19 AM
Are all of your savings goals met? Do you have money set aside for emergencies? Are you carrying debt that should really be retired? Is the maintenance on your house and equipment up to date? Is there money set aside to handle foreseeable replacements and repairs?

Wanting a white truck for your business isn't a reason that I would use to spend several thousand dollars and I don't really see how you'll look any better in it. IMO you either need to be sitting on a boatload of money or find much better reasons for buying it.

lone wolf
10-24-2010, 11:36 AM
It is not a color issue. It is a issue of keeping my personal truck, personal and having a dedicated work truck.

I feel like I am sending my truck to a early grave by having it do double duty. That is the issue, not color. Matching the trailer is a plus, not a deciding factor.

clydebusa
10-24-2010, 11:43 AM
As stated before, if you can afford it do it. A man with a spare has no care. The real problem with a lot of people is they think of their vehicles as people. A truck is no more than a tool, use the tool and when it wears out get another tool. If you want a personal truck than buy one. Something to think about is maybe the 4x4 should be your work truck and buy another personal. Good LUCK!

93Chevy
10-24-2010, 01:39 PM
I feel like I am sending my truck to a early grave by having it do double duty. That is the issue, not color. Matching the trailer is a plus, not a deciding factor.

I know exactly what you're talking about. My truck has given me numerous problems this year. Before this year, I'd put on mostly highway or city miles with little to no load. It would be safe to say that I wasn't using it to it's full potential. However, this year, when my business took off more, I was towing almost every day, hauling stone or mulch, going off road more and more. I'd love to use my current truck as a personal or work truck, but it's not going to last much longer as both.

SNAPPER MAN
10-24-2010, 01:41 PM
I would definatly get a work truck. I have a personal truck that I would never use for work. I also have work trucks I would never use for personal use. That's the way to go IMO.
Posted via Mobile Device

lone wolf
10-24-2010, 08:22 PM
Thanks Snapper Man, it is hard to find people that agree with me. My partner (Dad) does not. That creates some tension between us.

BrunoT
10-24-2010, 08:46 PM
I been in business for 5 years. I have a 20' white/green enclosed trailer. I drive my green personal 3/4 ton.

Question: I can buy a white 3/4 ton pick-up. I would like to keep my personal truck, personal. A white truck I think would make me look better. You can't think of the double maintenance costs. My truck now is going through a oil change a month. The only "extra" is licence tabs. All other maintenance is split inbetween both trucks.

The bad is this white 1 is 2 wheel drive. I am kinda moving out of plowing anyway. I still plow, but I can take my green 4x4.

Should I have 2 trucks? 1 personal, 1 work?

Unfortunately that's not all there is to it.

1. Insurance on a 2nd vehicle would run maybe $1,000/year for decent coverage, but some pay much more than that. You will also need to insure both vehicles commercially if you ever want to use your personal truck for plowing. Crash or damage something costly when on a personal lines policy and at work and they will deny the coverage.

2. You correctly thought of the tag/ad valorem taxes for the 2nd vehicle. Varies widely, maybe $150/year minimum.

3. Maintenance/repairs. As you stated, not much additional here as you would be putting fewer miles on the personal truck.

4. Fuel: probably unchanged as well

5. Loan interest (or the opportunity cost of having $10K-$20K or so tied up in a second vehicle. $500 to $1,000/year if borrowing, maybe $300 to $600 in interest from a CD you'd be foregoing to buy a truck.

6. Depreciation. Hard to calculate for sure, but both trucks will continue to depreciate as they age, independently of the mileage being put on them. You put fewer miles on the personal truck but more miles on the 2nd truck. But count on at least $1,000 more in total loss-of-value of those assets per year.

Total

$2450 minimum costs per year.

The costs of vehicles are not only what most people think of (out of pocket expenses like payments, gas, insurance, etc). If you had $10,000 invested in the market and you withdraw that to buy a truck you have to include that ("opportunity cost" in economic speak) in your costs. Because you have forgone income from that money.

I have a simple white HD work pickup now. I've used flashy red ones, black ones, green ones, and two tone ones. Nobody cares. They care that you are clean cut, your equipment and truck look well cared for, and that you know what you're doing and do it reliably. For years I used a truck that did double duty (personal and work use). I can use a "work truck' now because I'm married and have access to nice cars for that.

Looking at the above costs I would say that if you must have a white truck buy one that suits you for personal use as well and sell the green one. Second vehicles may also run into issues with parking space, a little more personal maintenance to do (car washes, etc), but they do have the intangible advantage of being a backup for your main work truck. It's just a fairly expensive luxury for a small business.

FYI, I bet those others with a dedicated personal use nicer "spare" truck also have a spouse and the second does family duty. A single guy with two trucks is a different matter. And as for wearing out your truck using it for work. Yes, it will depreciate faster. But not enough to outweigh the other costs. Trust me, I have a BBA and have done these calculations many times using historical resale data. And a large pickup is hardly an efficient personal use vehicle. Your dad is right on this one.

If you are talking about a $4,000 old pickup for work (total beater) and paying cash and only carrying liability insurance and your other truck is an expensive one, it might start to make more sense. But then you're driving a worn out truck to earn a living with so you can 'save' your good truck to drive to the movies and grocery store in. Does that sound logical to you?

dhardin53
10-24-2010, 09:35 PM
Tax and IRS wise if your not married or have only one vehicle within your house hold you will need to have a lot of extra record keeping to show just what you drive for business and what you drive for your personal use.

A "work truck" is much easy and less confusing at tax time, you take all the work truck expanses (tags, insurance, gas and repairs) off your taxes. If you only have one vehicle as your primary transportation with a business its a easy red flag for a audit.

BrunoT
11-11-2010, 02:36 PM
Tax and IRS wise if your not married or have only one vehicle within your house hold you will need to have a lot of extra record keeping to show just what you drive for business and what you drive for your personal use.

A "work truck" is much easy and less confusing at tax time, you take all the work truck expanses (tags, insurance, gas and repairs) off your taxes. If you only have one vehicle as your primary transportation with a business its a easy red flag for a audit.

I hear what you're saying, but it really isn't that difficult. For years I was single and had a work/personal truck. You are only required to keep a log of the use. Pretty simple. Some even just fake it. They won't flag it for that if your personal use is in the realistic range. I do my taxes with software and it walks you throught it all.

For $2400/year I'd assume a young guy starting out would be willing to flip open a log book and note the mileage used at work that day, then type in "80%" or whatever in some tax software to indicate business vs personal use.

The tax form asks you "do you have another vehicle available for personal use?". If not, just check no and be sure you don't try to claim 99% business use. No audits yet in 20 years. I don't even claim 100% on my work truck, even though it almost is all work use. Just to be sure.

cutterschoice24
11-11-2010, 03:46 PM
i was in the same boat for a while i have a 97 ford ranger ext cab that i was pulling my trailer with bought it in 99 put about 100,000 miles on it when i got a 61 turf tiger and put it in the trailer then i had to get air shocks because that was a lot of weight for the truck fast forward to 2006 i bought a brand new f-150 0 miles on it stx ext cab 4.6 liter pulls the trailer very nice now i have a 7x16 enclosed trailer with a 2 1/2 v nose so now i pull about 23 ft of trailer now I'm very glad i have the two trucks next year i;m going to hire a another guy and have a maintenance crew while i go out and do side jobs landscape jobs etc so having two vehicles is nice you don't necessary need to have two full size trucks just my opinion.

Richard Martin
11-11-2010, 04:55 PM
I hear what you're saying, but it really isn't that difficult. For years I was single and had a work/personal truck. You are only required to keep a log of the use. Pretty simple. Some even just fake it. They won't flag it for that if your personal use is in the realistic range.

I do the same thing. I do keep detailed records (log book) of every mile I drive for business. Look at the beginning of year mileage and end of year mileage. Come up with total on vehicle for year. Calculate business miles using the log book and subtract from total mileage for pleasure mileage. It takes 2 minutes if you use a pencil and paper.

The IRS has normal ranges for every kind of business there is. If you go above or below those ranges your return is kicked out for a quicky internal audit. It happens all of the time. If an auditor doesn't like what he sees they may send you a letter asking you to explain it or call you in for an interview.

This is a different type of audit from the full on audit that they just randomly do.

If you do $30k a year and claim 40,000 miles then there's a good chance that you're going to need to explain all of the miles when all you do is cut grass.

djchiodo3
11-11-2010, 05:43 PM
Work truck was in the shop over three weeks during the summer. If it wasn't for my personnel truck(backup truck), I would have had to rent a U-Haul truck or something. I like knowing that I always have another truck on hand. Plus, the 20ft trailer never gets unhooked unless I am going to the dump.

tjlco
11-12-2010, 03:18 AM
Up until last year I had one truck for both. Now I have a work truck and a personal truck. Best thing I ever did....especially with two kids. But our personal and business finances are serparate. So if the business can afford a payment right now and for the next 5-7 years then go for it. If you've got the cash to lay down go for it. Some guys here won't agree some will, but that what makes this site good.

Aaronnc
11-12-2010, 10:51 PM
Are you a registered business? With tax I.D and insurance and all that? The reason I ask is, you can seriously consider leasing if you want to go the two vehicle route. You would have to sit down and talk to an accountant to figure out your personal situation. We figured with payments and insurance and maintenance, our one tons were costing us $9233 a year, my CPA told me he writes off $5k of that every year. Also we went looking for chassis cabs at a Dodge Dealer and saw this. (Put it in a link.) If you hire and retain unemployed people, you can write off up to $500k in vehicle purchases. Just check with a good tax advisor. They should be able to look at your situation and explain everything you need to know. http://www.dodge.com/en/commercial/programs_discounts/RAM_ARRA_Flyer_rev.pdf

orlawncaresvc
11-13-2010, 12:10 AM
It is not a color issue. It is a issue of keeping my personal truck, personal and having a dedicated work truck.

I feel like I am sending my truck to a early grave by having it do double duty. That is the issue, not color. Matching the trailer is a plus, not a deciding factor.

I totally understand your situation. We used to run our personal trucks when we first got started. It wasn't too bad at first because we had a small set up at first. And besides we would take turns using different trucks. Mine, 03 silverado. My brothers, 97 gmc sierra. And my dads' 05 silverado. Then as our business began to grow so did our set up and our trailer did also. We built a huge trailer and we thought that our little half ton pick ups would pull it fine. Did we learn the hard way. The tranny on my brothers went first, then mine. Luckly for my dads truck we didn't use it much with our big trailer. So we decided to to buy a dedicated work truck. A truck that when we got home at the end of the work day we didn't have to unhitch it because we had to go to the store or some other reason. We bought an old 72 C10 3500 from our uncle for $1,000.00. The truck looked like junk at first but after we got a hold of it we made it look some what nice and professional. A perfect fit for our operation. That truck gave us 2 good years, then the rear end brakes began to give out. So we began to look around for our next work truck. 1990 Chevy K3500 1 Ton 4x4 dually. We found it on craigslist for $2,700.00 It has been the best desicion we made for our operation. Now I'm not trying to tell you that you need to go out and purchase a huge truck like we did. But I will tell you that it does make it easy when you got a truck that is just dedicated for work. While your personal truck stays home safe.

doubleedge
11-13-2010, 01:41 AM
Are you a registered business? With tax I.D and insurance and all that? The reason I ask is, you can seriously consider leasing if you want to go the two vehicle route. You would have to sit down and talk to an accountant to figure out your personal situation. We figured with payments and insurance and maintenance, our one tons were costing us $9233 a year, my CPA told me he writes off $5k of that every year. Also we went looking for chassis cabs at a Dodge Dealer and saw this. (Put it in a link.) If you hire and retain unemployed people, you can write off up to $500k in vehicle purchases. Just check with a good tax advisor. They should be able to look at your situation and explain everything you need to know. http://www.dodge.com/en/commercial/programs_discounts/RAM_ARRA_Flyer_rev.pdf

Where in that like does it say that you have to retain unemployed workers? It looks to me like it is intended to decrease unemployment by giving small business more money to work with.

Aaronnc
11-13-2010, 01:53 AM
If you look at the top of the Dodge link it says "Hiring Incentive to Restore Unemployment Act of 2010." When I called my CPA and asked about it, he called it the HIRE Act. (I didn't investigate further because we could stand to cut 2-3 employees right now.) http://www.irs.gov/newsroom/article/0,,id=220326,00.html

yardguy28
11-13-2010, 09:28 AM
why is your truck going through an oil change a month? do you seriously drive 3000 miles a month?

my truck's oil is changed every 3000 miles. lots of times past that.

while it is nice to have seperate vehicles for work and personal its not necessary. if it's your budget i would do it. but if not don't worry about it.