No one is paying that much (58.5 cents per mile)

[Reuben]

gregster:

My guess is that you amortize the repair over a single tax years time, not one pay period.

Sorry gregster your guess on this one is a little off base. According to Generally Accepted Accounting Principles (GAAP) when you make repairs to a piece of equipment those repairs add to the value of the equipment and extend the expected life of the equipment. The ammortization of the repair would then be done over the new expected life of the equipment.

In simple terms what you have done by repairing the transmission on the car has made the car worth more and extended the period of time that you could use the car.

For example : If the book value (for accounting) of the car was $2500 before the transmissin failed you have increased that to $4000 and extended the useful life of the car from lets say 2 years to 5 years (using the Straight line method). The method of ammortization used (straight line or declining balance) also determines the amount and length of time the repairs would take to be fully ammortized.

 

[system]

Reuben:

gregster:

My guess is that you amortize the repair over a single tax years time, not one pay period.

Sorry gregster your guess on this one is a little off base. According to Generally Accepted Accounting Practices (GAAP) when you make repairs to a piece of equipment those repairs add to the value of the equipment and extend the expected life of the equipment. The ammortization of the repair would then be done over the new expected life of the equipment.

In simple terms what you have done by repairing the transmission on the car has made the car worth more and extended the period of time that you could use the car.

For example : If the book value (for accounting) of the car was $2500 before the transmissin failed you have increased that to $4000 and extended the useful life of the car from 2 years to 5 years (using the Straight line method). The method of ammortization used (straight line or declining balance) also determines the amount and length of time the repairs would take to be fully ammortized.

Well, now you understand why I underlined the word guess in my reply, and referred the questioner to what I thought to be the best source of information.

I hope your answer clears up Registered Guests questions, and/or you can help to answer him where I can’t. Thanks!

Are you an accountant? If so, what’s your take on all this mileage stuff? Actually I’m interested in you opinion no matter what you do!

Edit: Never mind. I just found your ‘have his cake and eat it too’ post.

 

[Registered_Guest]

Gregster,

You might not consider this a serious question, but please humor me and consider it.

What if I claim that it is your personal choice to drive your vehicle to complete your job? I don’t require you to drive, in fact I don’t care if you walk, ride a bike, or skateboard.

As long as you can get the pizzas to my customer in my specified time frame you are free to do it any way you want.

Now, if you choose to use your personal vehicle to do that, it’s on your own dime.

If you are able to deliver the pizzas within my timeframe, I’ll give you a bonus of $1.25 for each delivery.

 

[NicksPizza]

gregster:

Registered Guest:

If I, as a business owner, want to avoid violating minimum wage laws - don’t I need to know EXACTLY what the actual costs are for you to operate your vehicle - so I can know if I am (based on your arguement) in violation of minimum wage laws?

The way to know exactly is to use the actual cost method and then take on the burden of collecting, and analyzing all of the applicable paperwork receipts, gas, repairs, depreciation etc. and then calculating the costs. If a guy drops off his application driving a new Ferrari, I’d reject the application for several reasons.

How many owners/operators reading this thread ask the type of vehicle on their applications? I have always asked what type and age of car. I will probably henceforth resist, if not refuse, hiring drivers of SUV’s and other low MPG cars, as well as those with enough age to need significant maintenance. We pay drivers Minimum wage or higher, and track milage to adjust compensation as needed. We have consulted professional regarding our compensation practices, and are in compliance . . . but avoiding this sort of thread with one of MY employees seems prudent.

Treat them with respect, pay a fair wage and keep employee performance records current. This last one is invaluable in terms of documenting raises/promotions as well as expedient dismissals. Arguing pay is NEVER valid reason for dismissal ethically or legally.

 

[system]

Registered Guest:

Gregster,

You might not consider this a serious question, but please humor me and consider it.

What if I claim that it is your personal choice to drive your vehicle to complete your job? I don’t require you to drive, in fact I don’t care if you walk, ride a bike, or skateboard.

As long as you can get the pizzas to my customer in my specified time frame you are free to do it any way you want.

Now, if you choose to use your personal vehicle to do that, it’s on your own dime.

If you are able to deliver the pizzas within my timeframe, I’ll give you a bonus of $1.25 for each delivery.

As long as you don’t require delivery drivers to use cars or other vehicles to deliver, that is acceptable. If walking is an acceptable speed for you and your customers, you’d be good to go. Your delivery radius would likely be greatly reduced though, so your ‘deliverers’ could meet customer expectations.

Bicycle delivery is also an option, but there is a small cost to operating a bicycle, but my guess is that it is orders of magnitude cheaper than those for a car.

If the timeframe you require can only be met by using a car, then we’re back to square one.

 

[Reuben]

Here is a little reading you might find interesting. http://www.irs.gov/publications/p463/ch04.html

Just a few thing to look at: your mileage cannot include the commute to and from your place of employment, there are restrictions that limit your ability to claim your automobile based on the percentage it is used for business.

I have the opinion that if you are quoting government documents you are in a nasty can of worms because for every one that supports your cause there will be one that undermines it.

 

[system]

Reuben:

Here is a little reading you might find interesting. http://www.irs.gov/publications/p463/ch04.html

Thank you. I have already looked at that information and brought it to attention in this thread.

Reuben:

Just a few thing to look at: your mileage cannot include the commute to and from your place of employment, there are restrictions that limit your ability to claim your automobile based on the percentage it is used for business.

That is correct. We are only talking about miles while delivering pizza.

Reuben:

I have the opinion that if you are quoting government documents you are in a nasty can of worms because for every one that supports your cause there will be one that undermines it.

If you find some “government documents†that contradict what I have posted here, please do share them and quote the specific passages that support your argument.

 

[Dox47]

Registered Guest:

Gregster,

You might not consider this a serious question, but please humor me and consider it.

What if I claim that it is your personal choice to drive your vehicle to complete your job? I don’t require you to drive, in fact I don’t care if you walk, ride a bike, or skateboard.

As long as you can get the pizzas to my customer in my specified time frame you are free to do it any way you want.

Now, if you choose to use your personal vehicle to do that, it’s on your own dime.

If you are able to deliver the pizzas within my timeframe, I’ll give you a bonus of $1.25 for each delivery.

I may just be speculating here, but I believe this sort of thing would fall under the same category that got Domino’s in trouble with the 30 minute guarantee, or more recently got Walmart sued for wage violations. What I’m talking about is trying to use sleight of hand to shift responsibility to a third party that didn’t make the actual decision. In the case of Domino’s, even though they didn’t tell their drivers to break traffic laws, their 30 minute guarantee created a situation in which the only means for the drivers to not be disciplined was to break the law. Same thing with Walmart, they didn’t tell their store managers to shave hours, they just created a system where it was de facto impossible to meet labor goals without cheating the employees through hour shaving. In both cases, the company ultimately was found responsible. To put it briefly, it is my belief that if you tried such a system and it was brought to the attention of the DOL or other regulatory agency, they wouldn’t be amused.