Jet-Precoolers™ Tax Benefits
Jet-Precoolers™ can be a Tax Shelter
With Section 179, you likely can deduct the entire cost of a Jet in 2017! See “Understanding The Section 179 Deduction Or use the “Section 179 Calculator”
Absolutely, might be the best tax shelter the produce industry has ever seen. With 3-year depreciation as personal- and not real-, property, the tax savings in the first three years of ownership can be as high as 39.6% or 40%. And that’s just the start.
If I were a tax advisor, which I am not, and if I offered tax shelter advice – which I don’t, here is what I would write about several ways of structuring your Jet Precooler ownership. Consult with your own tax advisor for sane and safe advice!
Scenario 1: The owner of a closely-held company buys the Jets, and then leases them to the company; the owner writes off the depreciation, the company writes off the entire lease payment. The Electrical Utility companies also can contribute, with rebates because of the energy-efficiency of the Jet design. Call me, of have your tax advisor call me, Jim Still 610-248-9800 office and cell.
Scenario 1 Worksheet:
|$16,900||Purchase price of Jet Precooler|
|$2,450||Price for VFD|
|*****||Cost of Money and Tax Rates|
|6.00%||Interest rate on bank loan|
|5||Term in years|
|39.6%||Marginal tax rate owner|
|40.0%||Marginal tax rate company|
|$387||Monthly P & I|
|$387||Owner leases to company at net/net|
|*****||Summary of Financial Flows & Deductions|
|-$1,267||Owner Interest deduction for 5 years|
|$3,220||Owner Interest payments on loan|
|$0||Owner gross profit, payment in versus P&I out|
|$23,199||Total of all monthly payments by company|
|-$9,280||Tax savings Company operating expense deduction for 5 years|
|-$7,920||5-year depreciation tax savings|
|$4,733||NET “If Financed” and leased back to company|
|-$1,715||VFD Rebate at 70% max cap|
|$3,018||Possible with rebate also on VFD|
|-$14,000||Rebate if on entire Jet Precooler|
|-$9,267||Possible “cost” (they pay you) with rebate also on entire Jet Precooler
BETTER THAN FREE!!
Scenario 2: Imagine if you put the Jets inside your IRA, or 401-k, or other Qualified Plan, and the company paid that entity, oh say, fair market lease of $1,200 per month per Jet into your plan. Call me to discuss, of have your tax advisor call. Jim Still, office and cell 610-248-9800.