The Portmans

Writting Off Your Car

Parent Category: Thoughts Category: Pizza
Published: 09 May 2012
Hits: 2355

Updated January, 2014

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 See also - My "Keeping Track of Tips"



I used to provide this each year in January for my store, and very few if any people read it. Then in April, they would be shocked when I told them I recieved an additional $2,000 for writting off my car. This is what I do and have done for more than 15 years. How much I get back varies, but for the last five years, it has been about $2,000 each year.

Taxes and Tips - Tips, Gratuities, etc. are income. Income is taxable. This includes cash tips not reported to your employer. I pay taxes on my tips and I claim a deduction for the vehicle that earns those tips. I did know a driver once who: a) Grossly over inflated his vehicle expenses (a 12 year old Nissan with bills like a Rolls Royce) and b) Did not claim one dime in tips. IRS hit him for three years of taxes on what they thught he earned, plus interest and penalties. IRS garnishments are a bitch.


The formula is fairly straight forward. What were your vehicle expenses? What was the percentage of your driving that was work related? That percentage minus any reimbursement is deductable. You can use actual expenses or the standard milage rate.  For 2012 the IRS reimbursement rate is 55.5 cents per mile. For 2013 the IRS reimbursement rate is 56.5 cents per mile.

IF you use the standard milage rate, take your work miles, multiply by 0.565 and subtract your reimbursement. Pretty simple. For actual expenses, you will need to total them up. A little harder. You can calculate both numbers and then use the one that is best for you.

Tax prep software will go through these steps for you. All you need is your records. For years I did my taxes with a stack of paper forms and Excel. It was a pain to enter the formulas, but it worked. Then I bit the bullet and tried TurboTax. Got sick of TurboTax and tried H&R Block software. This year I helped a co-worker with his taxes using TaxAct Online. It was free for an efiled Federal return and $15 for a state return. Sure beats the $45 for purchased software and did a fine job.

IRS Publication 463 spells out the steps and form 2106 is the form to use to claim the vehicle deduction. What IRS doesn't tell you is the records you should have to fill these out.

You will need records of: How many miles you drive in the year; How many miles you drive while at work; Your vehicle expenses; When and for how much you bought your car; How far is your communte. Written records are the best. If your store uses a computerized checkout system, ask for a printout after every shift. I create a spreadsheet that tracks all of this in addition to tracking my tips and wages. You do not need to get nearly this complex. A pocket notebook works just as well, with a folder or box for reciepts. One of the questions on from 2106 is "Do you have written records?" It is so much easier to create/keep them as they happen then to hunt for them when you do your taxes, and those new tires were put on seven months ago.

The miles you drive

The miles you drive are broken down into three catagories. Work miles, commuting, and non work. As I have been doing this for several years, I have the odometer reading from the end of my shift on the last New Year's Eve and this New Year's Eve. A minus B equals the total miles driven. For 2011, I drove 39,400 miles and change.

Commuting miles are just that, the miles from your home to work. I know how far the trip is, times two, times the number of days a week I work, bingo, commuting miles.

Work miles are just that. Miles driven for work. If you are being reimbursed by the mile, getting this number should be easy. You can add to this miles driven from one job to another. So, I can add the miles from my day job to my pizza job to my delivery miles. I drove a little over 6,800 miles at work in 2011. I work about two days a week. Why yes that is more than 65 miles in every five or so hour shift.

So work miles divided by the sum of total miles minus commuting miles expressed as a percentage is...18%, ballpark.

Now Expenses

Gasoline, oil changes, repairs and parts are the easy ones. You will be shocked when you see what you are spending a month in gasoline. For me it is about $250 and I am a part timer. Along with repairs comes maintainence like car washes. Insurance. How about a kickback of 20% of what you pay for car insurance? Property tax on your car, inspections and license fees. Do you do your own repairs? Keep the recipts.

Depreciation

You can depreciate the value of your car. It is a little more complicated, but doable. You will need the date you bought the car and the price. Depreciation has its best advantage in the first five years you own the car. Not the first five years of the car's life, your first five years with the car.


 

Now start on form 2106. It is pretty straigh forward. You do need to know how much in mileage reimbursment you recieved during the year. It goes on line 7. Page two has the worksheet for vehicle expenses. When you are done, enter the amount from your 2106 on your 1040 schedule A. Schedule A is for deductions. If you are an old fart like me, you already knew this. For some newer tax payers, welcome to the world of deductions. While you are here, check out some of the other things you can deduct. Did you donate clothes to a charity? Deductable. Did you give to an allowable charity? Deductable. Be careful with this one. IRS looks for cheats here. Childcare? Education expenses? Moving expenses? Fat cats write off millions, ask Mr. Romney or GE. With tax prep software and record keeping, you can get back a big chunk of change.

Should I Bother?

It takes me about an hour to fill out form 2106. If you need to scour your house and trunk for recpeipts, maybe it will take you a lilttle longer. I also keep a spreadsheet of every shift I work. It also has my year to day mileage once midnight rolls around on January 1. Everyone's tax situation is different. It is possible that even with the mileage deduction, the standard deduction is better for you. If so, take it!. The online tax software will even print you a 1040a or 1040ez, if you do not need to file a full 1040.

 

Word Processing for 5th Graders (and Their Teachers)

Parent Category: Family Category: Yael's Blog
Published: 28 March 2013
Hits: 2183

Note: This was originally written for Yael to teach her teachers how to teach using a word procesor. Sadly, it has come up again.

Yael is now a 7th grader, teacher typing has gotten worse.

 

Daddy asked what I was going to work on today. I told him a paper. Then I started telling him about how I had to type it. Two spaces after a period.  "Wrong." Said Daddy. "It is one space and always one space. It has been all of your life." Two spaces are for typewriters.

 

I need to type in 16 point type. Then switch to no bigger than 14 to turn in. That way it is easier to read. "Wrong." Said Daddy. "That is what zoom is for." You make things bigger on the screen with zoom.

 

I need to remember to type in double space. "Wrong." Said Daddy. "You type in single space to write your paper. If your teacher wants it turned in double spaced, open it up, switch to double space, and then print it.

 

I need to leave a space and indent the first word. "Yes, if you are using a pen." New paragraphs are either indented or separated by a line break, but not both. Line breaks are easier to read and most commonly used today.

 

For business writing most people use full justification. It looks better in print. This page is left justified because it needs to be read on different browsers and that works better online.

 

Centering, right justification, and indents are done with the paragraph and/or tab settings. Tab, tab, tab, space, space, space, will never, ever, ever work right, especially when printed.

 

What is the final output going to be? The old rule was sans serif fonts for screens and sarif fonts for paper. That is fading. But stick to readable fonts.

 

Also see More Rules for Word Processing

 

That is the bad side of having geeky parents. They know how to use Office way better than my teachers.

 

It is always one space after a period. (Slate.com)

 

How to zoom in or out in a document. (Office.Microsoft.com)

 

How to adjust line spacing. (Office.Microsoft.com)

 

And a Bonus

 

I hate Comic Sans

 

More Rules for Word Processing

Parent Category: Family Category: Yael's Blog
Published: 01 April 2013
Hits: 1705

Bold

Bold is for em­pha­sis. That is, the important stuff. If you are emphasizing more than 10% of the page, none of it is important. If you want darker print, use a darker font or change the toner in the printer. Come to think of it, if you dont' bold everything, the toner would last longer.

Italics

Italics is for names. There are lists of specific kinds of  names that should be in italics, but italics is not for emphasis, it is for names.

Underline

If you are using a pen, you underline for emphasis. My Grandma enjoys caligraphy. She could italisize a single word in a sentance. She wouldn't, she would underline. In the web world, underlines are for hyperlinks. Thjs is what it says at Grammar Girl.

A bonus on underlines. Microsoft Office will automatically underline and make active any web address. This leads to print out with underlines that look funny. My daddy says that if you right click on a link you do not want to be a clickable link (like any link that is not going to be on a screen) you can remove the hyperlink.

Small Type and Large Type

Daddy says that one day, he was converting a document from WordPerfect to Microsoft Word. He discovered that for many years someone who should have known better used subscript for fine print instead of a small type face. That is BAD! BAD! BAD!

 

In a bibliography, you should quotation mark, underline, and italisize like the example.

 

Typography for Lawyers. Grandpa was a lawyer but he let someone else type stuff for him.

Grammar Girl

 

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