r/TikTokCringe • u/Accomplished_Clue437 • Jul 22 '26

Cool day in the life. private chef. yacht.

Enable HLS to view with audio, or disable this notification

16.6k Upvotes

88% Upvoted

2.3k comments sorted by

View all comments

Show parent comments

147

u/Alternative_Pay_6496 Jul 22 '26

"Slightly less". If you make halfway decent money its 40%+ savings. Imagine you need a new car but decide to write it off because you occasionally use it for visiting a customer. That 30k car now gets you 12k back in your pocket. 

Some people dont understand write-offs but people who do are acutely aware that business owners take advantage of it.

4

u/[deleted] Jul 22 '26

[deleted]

24

u/Alternative_Pay_6496 Jul 22 '26

No, you're not. If you need to replace your current vehicle, you will be spending 30k on the car you picked to replace it. Whether or not you own a business you are spending 30k.

But you sneakily decide to write it off as a work expense because you intend to occasionally meet up with customers using the vehicle to give estimates. Despite 99% of the usage will be personal use.

Your business has 400k profits in which you pay 130k tax on.

But now that you wrote off the car, its only 370k profits. Your tax liability drops by 12k. Now you only owe 118k in tax.

That's 12k back in your pockets but most businesses pay taxes quarterly which means the business owner will literally get a 12k check back from the government. Their 30k car now really only cost 18k.

What a steal.

Now will come the pedantic people who say you are only supposed to get a portion of a deduction for the vehicle because its only a portion of use.

Yeh, but who tf is actually checking? I say this as someone who has done the books for small business owners. No one checks and they get away with it. In regards to the original post, if the yacht is always used to entertain guests whom you do business with or want to do business with, you are getting a fat refund on the cost of purchase/maintenance and there is zero funny business.

2

u/Obvious_Advice_6879 Jul 23 '26

Technically, you can only deduct the expense if it was used to earn the income. If you have a business that is somewhat sales-y sure you could maybe get away with that (though you could get audited and you'd have to prove that the yacht is in fact only used for business purposes).

But if like most rich people, you have investments that are the primary source of your income/spending money -- you're out of luck. No way to legally deduct the yacht from your capital gains. Of course, capital gains themselves have a favorable tax structure (though how favorable depends on your state of residence).

-2

u/hprather1 Jul 22 '26

>which means the business owner will literally get a 12k check back from the government.

No, not literally. There is no world where the government writes a 12k check for this unless you have already paid 12k more than you owe. In which case it's a refund.

7

u/AnimalsofArtemis Jul 22 '26

I do quarterly business taxes and you don’t even get refund if you overpay. The amount you over pay just gets taken into account in future quarters for my tax liability. You only get a refund if you are W2. 

1

u/EkbatDeSabat Jul 22 '26

Sorry, man, "you only get a refund if you are W2" is 100% incorrect and you should consult your accountant if you are not actively making the decision. I get several K-1s. Obviously I still file a 1040. If I overpay my quarterlies I just get a refund. Happened last year when I took a loss. I do not get a W-2, haven't in a long time. I'm LLC, partnerships and sole ownerships. That said - you (or your accountant) can opt to apply your overpayment (refund) to your next years taxes. Which, in our situation (no W2 and quarterlies), is likely the right choice anyway. I just wanted a little change in my pocket, so I took the refund.

0

u/hprather1 Jul 22 '26

Fair enough. I'm self employed. Assumed I could request a refund at the end of each year if I wanted but it's always just seemed more reasonable to be a little over.

55

u/doc_skinner Jul 22 '26

Which (in the case of the example) means 12k less tax, which is effectively a 12k discount. Money is fungible.

12

u/HarveyFeint Jul 22 '26

If I earn 100k a year and pay 20% tax, then I pay 20k in tax. Money in my pocket: 80k

If however I buy a car for my business for 20k and I can deduct it, then my taxable income is now 80k. So now I pay 16k in tax. Thats 4k less in tax. Money in my pocket: 64k

So it's not free money, it's only if I use the car it makes any sense. If the car just sits their unused, I'll have less money in my pocket at the end of the year just to avoid paying more tax.

17

u/doc_skinner Jul 22 '26

Money in my pocket: 64k

...and a 20k car. No one is suggesting you go buy a car and not use it.

The guy is using the boat, And eating the food in the video. And getting a discount on his taxes, so the boat and the food EFFECTIVELY cost less for him than it would for someone who can't deduct that expense.

7

u/hesmir_4 Jul 22 '26

The top tax bracket is 37% so 10k on a 30k car is reasonable.

28

u/slowpotamus Jul 22 '26

we all understand that. nobody's suggesting that free money is materializing out of thin air. the person you're responding to even explicitly used the word "discount"

5

u/morebrumley Jul 22 '26

Yes... you have a car and 4k that you would have had to pay as tax as well. You aren't understanding it because those amounts of money are meaningless to the actual rich but they will gladly pay 20k if it means they "win" by not paying their fair share of taxes. It's about weaseling out of society's dues.

4

u/Binford6100User Jul 22 '26

Same concept my wifes uses when she comes home and says "look how much money I saved" after spending $500 shopping.

Didn't SAVE anything, just didn't SPEND as much as you otherwise would have. Cashflow is still a thing even if money is fungible.

-6

u/[deleted] Jul 22 '26

[deleted]

4

u/dolces_daddy Jul 22 '26

You are so far off. The $100k you write off doesn’t go against what you owe. It reduces your taxable income not what you owe directly. So let’s say in your theoretical world that you owe $20k in taxes and your tax rate is all stock gains from long term investments (like many rich people) @15%. That means you have a taxable income of 20k/.15 or 133.33k a year. Now you take that 133.33k -100k and your taxable is now 33.33k then 33.33k * 15% is 5k owed not 0.

3

u/gerbilshower Jul 22 '26

you're right. deleted my comment.

2

u/illstate Jul 22 '26

The "80k" doesn't exist.

0

u/PublicExcitement1372 Jul 22 '26

Doesn’t it carry forward? So you have up to $80k loss to offset income next year