Introduction Please don’t forget to subscribe and hit that bell for future videos. Thank you. Hey, what’s up, guys? Houston here. And for those of you just finding my YouTube channel, as always, welcome. Please remember to hit that subscribe button and that bell. In this article, I will be discussing three ways to purchase a car using your EIN (Employer Identification Number). Whether you have an established business or a new one, there are strategies you can employ to make your car purchase under your EIN number. Let’s dive into the details!
Way 1: Buying a Car with an Established Business If you already have an established business with a business bank account and a few years of history, this is the first option for you. Visit the commercial or fleet department of a dealership and inform them that you want to buy a vehicle under your business EIN number. They may request two years of taxes and three to six months of bank statements to verify your business’s legitimacy and financial stability.
Way 2: Buying a Car with a New Business If you have a new business and haven’t set up a business bank account yet, you can still purchase a car under your EIN number. However, you will likely need to provide a personal guarantee. To increase your chances, apply for business credit cards and lines of credit, leveraging your established personal credit. With a significant enough business line of credit, you can buy the car using your business credit card or line of credit, and the vehicle will be automatically registered under your business. Keep in mind that if you obtain a business loan, the bank will hold the vehicle’s title until the loan is paid off.
Way 3: Exploring Other Options Apart from traditional dealerships, consider attending an auction to buy a car using your business credit card or line of credit. After the purchase, you will need to transfer the vehicle’s ownership to your business name and register it with the DMV. Remember that registering a vehicle as a commercial vehicle may have different registration requirements and potentially higher fees based on weight limits in certain states.
Understanding Insurance and Tax Implications When buying a car with a business loan, you must maintain full coverage insurance until the loan is paid off. However, if you purchase the vehicle using your business credit card or line of credit, liability insurance may be sufficient. Regarding taxes, even if the vehicle is not in the business’s name, you can still claim tax write-offs such as mileage and other expenses. It’s important to note that if you buy a vehicle under your business name, start with claiming mileage deductions first before moving on to depreciation for optimal tax benefits.
Additional Considerations Some dealerships may allow you to put a car in the business name if you provide at least 50% down payment. In this case, you can loan the money from your personal account to your business account to complete the purchase. Keep in mind that lenders may restrict financing for cars over $50,000 if you don’t have a paid-off car or a history of car payments on your credit report. They may require a higher down payment, usually between 20% and 30%, for such purchases.
Conclusion Purchasing a car using your EIN number is possible through various strategies. Whether you have an established business or a new one, understanding the different options available can help you make an informed decision. Remember to weigh the insurance and tax implications associated with each method and choose the one that aligns best with your goals and financial situation. Thank you for reading, and don’t forget to subscribe, comment, and share your experiences with buying a car under your EIN number.