Today TaxMama hears from Natasha in Florida who has a great idea. “Do you know if there are any tax benefits for using your vehicle as advertising? We may purchase a hybrid for our sales related business and plan on wrapping the entire car in our logo etc. “
That’s an interesting thought. And I am sure that if you drive around in the car that way, you’ll get lots of attention – and new business.
Well, let’s look at the tax side of this. IRS specifically addresses your question in Publication 463.
IRS says: Advertising display on car. Putting display material that advertises your business on your car does not change the use of your car from personal use to business use. If you use this car for commuting or other personal uses, you still cannot deduct your expenses for those uses.
So, if you’re using your car for business, keep track of the total mileage and business mileage just like you’re meant to without the advertising wrapped around the car.
Turning it into a rolling billboard doesn’t make it 100% business use. Good try, though.
What about all those college kids who get paid by advertisers to wrap their cars in ads? To the advertiser, that’s a 100% business expense. To the college student, that’s 100% income, less any costs for driving the car to specific events or on specific designated routes for the advertiser’s benefit.
And remember, you’ll find answers to lots of questions about advertising expenses and other tax information, free. Where? At TaxMama.com[Note: If you were subscribed to the e-mailed TaxQuips, you’d be getting other exciting news and tips. Please click on the subscribe link and join us.]
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