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Rat

Well-known member
Joined
Apr 25, 2010
Messages
977
Location
Silicon Valley
I just discovered I can actually profit just by driving my Leaf, i.e. come out ahead with money in my pocket, not just save money compared to driving an ICE. If you're self-employed you may be able to do it too.

Last weekend I drove 230 miles R/T to an event where I promoted my novel, including making some sales of autographed copies. Since I am required to do a Schedule C on my taxes for my book sales (it's treated as a business, not just royalties), I can and do deduct business travel. The permitted rate on cars (in 2012 anyway) is $.55 a mile. That's a deduction, not a credit, so your taxes are only reduced by your marginal tax rate times that amount. In my case, my federal and state rate combined is about 34% so my taxes are reduced by about 18.7 cents per mile. So that's $43 my taxes go down for that one trip, assuming rates and mileage rules stay the same for 2013. Of course that must be offset by the actual cost of driving the car. Since I did almost the whole trip on power from free public charging stations the electricity cost was near zero. I don't know what the marginal cost per mile of driving the car is when the power is free, but it must be very low. Something for the tire wear. Insurance and depreciation are probably negligible in my case since I drive very little as a retiree (and my wife drives even less in her car) and I think my insurance rates for both cars are based on the lowest mileage bracket the insurance company has, even with these occasional business trips. Similarly with depreciation. I venture to guess that whenever we sell or trade in the Leaf, it will still have very low mileage compared with other cars its age, and thus the condition is unlikely to be any different at the end of 10 or 12 years with or without these occasional trips, unless I have an accident, damage the battery from the QCs, or otherwise damage the car. Depreciation will pretty much be dictated by the model year of the car, since EV's are changing rapidly. A 2011 Leaf SL is going to be pretty much the same value with 85,000 miles 10 years from now as it will with 86,000 miles.

In terms of return on your time, a long trip may not be worth it, but if you can do it on free public charging (or even your regular employer's dime) you can make money doing this. If you can do it without the need to take extra time to charge, it's even better. For example, suppose you have a side business as a software consultant, and you're employed at company X, which provides free charging. If you run out at lunch to meet a personal client locally then come back to your job and charge up again at Company X, you can deduct $.55 a mile for the business travel, which you would have done anyway, but using the Leaf cost you nothing in terms of time or money.

In the long run we may find that there is a very real cost to each extra mile even with free power but for now I don't see it being anywhere near 19 cents a mile.
 
There's not really any money to be made, just a reduction in how much Uncle Sam will screw you. Before racking up miles to reduce your tax obligation, you should also take into account the $7500 you got when you bought the car. Neither the EV tax incentive nor the standard mileage deduction will result in a refund.

I used to write off more than actual costs by taking the standard mileage deduction when driving my Crown Victoria (400+ miles per day). Since my only business expense was driving, it really helped reduce what I owed at the end of the year. It definitely would be more of a slick deal with electricity. :)
 
Rat said:
. Since I am required to do a Schedule C on my taxes for my book sales (it's treated as a business, not just royalties), I can and do deduct business travel. The permitted rate on cars (in 2012 anyway) is $.55 a mile. That's a deduction, not a credit, so your taxes are only reduced by your marginal tax rate times that amount. In my case, my federal and state rate combined is about 34% so my taxes are reduced by about 18.7 cents per mile. So that's $43 my taxes go down for that one trip, assuming rates and mileage rules stay the same for 2013.

Don't forget that as Schedule C you are also saving on self employment tax (both sides of social security/medicare)
 
kubel said:
There's not really any money to be made, just a reduction in how much Uncle Sam will screw you. ...........snip.......
and ... if your CPA already keeps you (and your C corp, in our case) owing zero ... then you can't even use the deduction. We lost about 1/2 of our Leaf's potential tax deduction that way, during our 1st year of Leaf ownership
:(
 
The money doesn't work for everybody, but if your trip/travel is something you are going to do anyway, either for your business or for personal reasons (which you can combine with business enough to make it deductible), and you can do it the Leaf or some other way, it makes financial sense to use the Leaf. Consider that trip to meet the client. You can take a taxi, pay $20, and deduct it. You reduce your tax by $6.80, but you're out of pocket $20, for a net loss of $13.20. If you take the Leaf and the power is free to you, it's a net gain. It's only an inefficient way to make money if the choice is between going and not going. If you're going to go anyway and the only choice is which mode of transportation, using the Leaf is highly efficient at least up to the point where charging it slows you down. Then it becomes inefficient depending on the marginal value of your time, but even that may be cost-free if you can charge while you are doing something else you would do anyway, like eating or meeting someone.
 
Or mileage for work for not for profit organizations. For example next year the company will have free charging at the new building. Since I can deduct mileage driven as a Scout leader when I fill up before a campout at the office and then recharge the following Monday, it's free energy and get to count the miles donated.

BTW Rat, how's the author biz going? Hope it's good.
 
Or:

http://www.businessinsider.com/lyft-ride-sharing-john-zimmer-2012-9" onclick="window.open(this.href);return false;
 
ksnogas2112 said:
BTW Rat, how's the author biz going? Hope it's good.
Funny you should ask.

John Grisham doesn't need to worry about me unseating him, but the books sell pretty regularly, mostly in Kindle format. The hard part is the promotion and retailing when you're self-published. For example, recently a fellow geocacher in Texas liked my book Cached Out and asked to be able to sell some copies there. I had 10 sent to her and she sold them all in 10 minutes, she said, at a local geocaching event. She promptly sent me my share less her commission. She was on a committee sponsoring a "Mega Event" (over 300 participants) and asked for 100 copies. Against my better judgment I had 100 sent to her (my cost almost $1000). She sold 13. She sent me back a box of 24 at her expense, but now she's not even replying to my emails. So I'm out several hundred bucks unless she ends up coming through.

In the meantime, I still have some here. If anyone wants a good murder mystery in a full-size trade paperback form (6x9) -- autographed no less -- I'm selling Cached Out at a discount by mail while supplies last. $13 and I'll pay sales tax and postage (in the U.S.) That would be $14.95 + tax and shipping if you bought it from amazon.com so you're saving about $4. In fact, the offer goes also for my first book, Held for Ransom, although I only have a few of those. If interested, email me at Russ.Atkinson [at] gmail.com. If you want to know more about the books, click on the link in my sig line and check out the reviews on amazon.com. Feel free to buy the Kindle versions there if you prefer ebooks.
 
hill said:
and ... if your CPA already keeps you (and your C corp, in our case) owing zero ... then you can't even use the deduction. We lost about 1/2 of our Leaf's potential tax deduction that way, during our 1st year of Leaf ownership :(
You most certainly can use the mileage deduction. All your accountant is doing is having the corp pay you as an employee enough that the corp doesn't owe taxes. Therefore, you pay personal taxes instead of corporate taxes on the money. If the corp deducts it, it's that much less that ends up as taxable personal income to you.
 
if you drive a lot of miles the leaf is a VERY cheap car to own if you can get past the initial payment.

cheaper even than a $10,000 geo metro (if you could get one new)

10 year TRC figure 40,000 miles a year (the minimum I expect to put on my leaf)

the leaf cost me $17,000 plus tax and financing $25,000 plus I figure two batteries $11,000

75% of my power charging it is free and I have enough solar to more than offset the last 25% (close to 50%) so my electricity is $0

$36,000 all up cost for 10 years (regular maintenance can be ignored since both will need that)

A geo metro at $10,000 and 50mpg will need $29,000 in fuel so $39,000 total in 10 years.

figure another $1000 in 10 years for misc fluids and changes that the leaf will not require $40,000

so even with financing and two replacement batteries the leaf is cheaper still than even a GEO METRO and this is under a huge assumption that gas does not go up. yeah right.

my only concern is if the usable range on the leaf goes below my needs in less than 3.5 years. that would make the leaf cost just slightly more than a geo metro over 10 years if I need 3 replacement batteries.
 
nerys said:
75% of my power charging it is free and I have enough solar to more than offset the last 25% (close to 50%) so my electricity is $0
...
A geo metro at $10,000 and 50mpg will need $29,000 in fuel so $39,000 total in 10 years.
My ICE is free to operate, as long as someone else pays for the fuel. . .

Countiny your electricity as zero is not really correct, either. You are paying for the other use of power that the solar could have provided if you had not fed it to the car.
 
No. First its my solar so I get to define what it is used for. Second I installed thw solar "for" the electric car specifically. I eventually want to offset 100% of it including installing solar at work.

Third. That is some seriously silly semantics. Free e is free e no matter which way you spin it

Only one thing counts to me. Dollars in my pocket. Period.

The clean green aspect while very desirable to me is just a coincidental. bonus. Nothing more.
 
nerys said:
No. First its my solar so I get to define what it is used for. Second I installed thw solar "for" the electric car specifically. I eventually want to offset 100% of it including installing solar at work.

Third. That is some seriously silly semantics. Free e is free e no matter which way you spin it

Only one thing counts to me. Dollars in my pocket. Period.

The clean green aspect while very desirable to me is just a coincidental. bonus. Nothing more.


Generally people who are grid connected install solar PV to offset buying power from the grid. Thus the solar PV is saving you the 10 cents a kwh or whatever you pay. Until you have 100% of your electricity usage being generated by PV the combination of an EV and PV isn't saving you any money over each one individually. You can play games with the numbers but until you have 100% PV production the EV is still costing you whatever the utility charges.
 
I am not sure why this is confusing but I will try again

I estimate I will use about $800 a year charging the car

I have enough solar to save me about $400 a year in e.

Math seems pretty damned simply to me.

You seem to be strangely confused by it. How can I help you understand it?
 
nerys said:
I am not sure why this is confusing but I will try again

I estimate I will use about $800 a year charging the car

I have enough solar to save me about $400 a year in e.

Math seems pretty damned simply to me.

You seem to be strangely confused by it. How can I help you understand it?

Yeah as you said the math is simple. Owning an EV costs you $800 a year in electricity at the rate th utility charges and saves whstever you would have spent on gas.

Owning PV saves you $400 because you don't have to buy power from that power from the utility.

The two savings are unrelated and each would save the same amount individually.

A couple scenarios do create some synergy where having both saves you more money then each one indivusally. If you over 100% of your electricity usage and then time of use and tiered rates are complicated but having both can be advantageous.
 
The decision to buy one was predicated on the other. Direct unambigious cause and effect.

It does not get any more related than that short of jacking the car directly into some panels.

Why is that unclear to you?
 
nerys said:
The decision to buy one was predicated on the other. Direct unambigious cause and effect.

It does not get any more related than that short of jacking the car directly into some panels.

Why is that unclear to you?

I wasn't implying that one did not cause the other. If I were to guess I probably would not have a 73 panel system covering 100% of my electrical usage had I not gotten the Nissan LEAF.

My point is just that the ROIs and the money part of the equations of the two separate purchases are not related unless you have 100% of your electrical usage or TOU/tiered rate calculations. Why is that unclear to you?
 
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