A way around taxes?

Discussion in 'Business Operations' started by zz4guy, Feb 11, 2007.

  1. zz4guy

    zz4guy LawnSite Senior Member
    Messages: 901

    This idea popped into my head over the weekend, just wondering if it would be a feasible way to "write off" some tax liability...

    I run a part time lawn mowing business and operate used equipment. Since I operate with low overhead I can't deduct many expenses like guys with expensive equipment can. BUT what if I buy the expensive equipment anyway and let it sit all year and write that off as an "expense". Even if I barely use the thing. Then sell it on ebay with barely any depreciation. That way I can report an $8k machine as an expense They'll never know if I used it or not.... or will they?? What am I missing here? It sounds too easy.

    Just looking for new ways to keep my hard earned money. Thanks.
  2. Duekster

    Duekster LawnSite Fanatic
    from DFW, TX
    Messages: 7,961


    You have to put the Eq into service.


    Don't buy something just to beat taxes. Tax rates are never more than the amount you spend.
  3. Lawnworks

    Lawnworks LawnSite Fanatic
    from usa
    Messages: 5,407

    Honestly you could probably get away w/ that as long as you get cash when you sell it. I don't know if it would be worth it though. You probably only pay 20-30% in taxes... one year's depreciation might be 15-20%. So you are not really ahead that much.

    You could just spend some money on advertising. It will come back to you and you will need those expensive toys.
  4. mouse

    mouse LawnSite Member
    Messages: 98

    First off you would most likely lose money on that deal at least on the resale part plus you would still have to report income on the sale of your equipment. Besides you would have a fabricated a story that you would have to remember for the tax man, because he will cometh. Why not just buy the new mower and use it? This will make your nights sleep easier.

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