2013 year-end tax planning for dealerships

With the higher tax rates passed by Congress, many will be fretting about their tax situation come April. Although we are nearing the end of the year, plenty still can be done to have a significant impact on your 2013 tax bill.

To help taxpayers plan for higher rates, the Baker Tilly national tax practice has published its 2013 year-end tax planning letter, discussing various tax provisions that are expiring, the status of tax reform, the impact of the Affordable Care Act, and the latest changes in state and federal tax. 

Also, Baker Tilly’s dealership services team of tax professionals has compiled a list of dealer-specific tax considerations below. Please keep in mind that your goal should be to maximize your long-term wealth and profitability; decisions on tax policy are secondary considerations to this goal.

New rates for 2013

Motor vehicle dealers’ plate tax

  • The motor vehicle dealers’ measure of use tax increased to $149 for 2014. Wisconsin-licensed motor vehicle dealers are permitted to report use tax on a certain dollar amount per plate per month for the use of motor vehicles assigned to certain employees and dealership owners.
  • Effective Jan. 1, 2014, the amount of gross receipts subject to use tax rises to $149 from $144 per plate per month. Note: The use of tax per plate per month is not $149. Rather, $149 is multiplied by the use tax rate applicable at your dealership (5 percent, 5.1 percent, 5.5 percent, etc.).
Mileage rates

For dealers and employees who use their personal vehicles for business purposes, the optional standard mileage rate is 56.5 cents per mile for 2013. The 2014 rate has not yet been published. The optional rate for use of an automobile as a charitable contribution is 14 cents per mile for 2013 and 2014; the rate for medical and moving is 24 cents per mile for 2013 and 2014.

View additional information on payroll-related tax percentages and limits >

If you would like to discuss tax strategies specific to your situation, contact the Baker Tilly dealership services team.

Read the entire 2013 year-end tax planning letter >