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Tax Issues of Auto Dealerships: Floor Plan Financing, 163(j) Limitations, Clean Vehicle and Other Tax Credits

Note: CLE credit is not offered on this program

A live 110-minute CPE webinar with interactive Q&A

This program is included with the Strafford CPE Pass. Click for more information.
This program is included with the Strafford CPE+ Pass. Click for more information.
This program is included with the Strafford All-Access Pass. Click for more information.

Tuesday, May 20, 2025

1:00pm-2:50pm EDT, 10:00am-11:50am PDT

Early Registration Discount Deadline, Friday, April 25, 2025

or call 1-800-926-7926
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This webinar will discuss tax matters of automobile dealerships for sellers and tax advisers working with these companies. Our panel of federal income tax veterans will identify these issues and offer advice to maximize tax savings for these sellers.

Description

Automobile dealerships have unique tax issues. Most receive floor plan financing rates, allowing dealers to buy inventory now and pay for the vehicle when it is sold. The vehicles secure the loan. This short-term financing ensures the showroom is amply stocked with a wide selection of vehicles. Currently, Section 163(j) regulations limit the deductibility of interest for certain taxpayers. Although this limit does not apply to floor plan interest, if interest expense exceeds 30 percent of adjusted taxable income and the dealership is not otherwise exempt, the dealership cannot take bonus depreciation on any assets.

On Mar. 13, 2024, the IRS announced that sellers must register to receive Clean Vehicle Tax Credit payments. Purchasers can now receive a rebate when a vehicle is purchased rather than waiting months to receive a credit on their tax returns. Unfortunately, not all dealerships were aware of or signed up for the new system. The new online system must be used for advance credits as well as credits purchasers intend to claim on a tax return. Many purchasers planning to claim the tax return credit have had their claims denied because the dealership did not register under the new guidelines. Tax practitioners working with automobile dealerships must grasp the tax challenges these businesses endure.

Listen as our panel of auto dealership experts reviews these businesses' problematic tax situations.

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Outline

  • I. Tax issues of auto dealerships: introduction
  • II. Depreciation
  • III. Inventory
  • IV. Floor plan financing
  • V. Credits
  • A. Electric vehicle credits
  • B. Other credits
  • VI. Excise tax
  • VII. Impact of tariffs
  • VIII. Other issues

Benefits

The panel will cover these and other critical issues:

  • Managing floor plan financing
  • Depreciation options for automobile dealerships
  • Registering to receive Clean Vehicle Tax Credits
  • Other tax credits available to auto dealerships
  • The 163(j) interest expense limitations relative to automobile sellers

Faculty

Mulhearn, Michael
Michael B. Mulhearn, CPA
CPA, Partner
Withum Smith+Brown

Mr. Mulhearn is a partner based in our firm’s Philadelphia, PA office, with over 15 years of experience in...  |  Read More

Additional faculty
to be announced.
Attend on May 20

Early Discount (through 04/25/25)

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CPE processing must be ordered prior to the event. See NASBA details.

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Early Discount (through 04/25/25)

CPE credit is not available on downloads.

CPE On-Demand

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