From price and mileage to gas and diesel, let's explore the differences in new and used step vans. This article will compare the benefits, disadvantages, features, and pricing for both new and used step vans.
Explore the Differences in New and Used Step Vans
New Step Vans carry a higher price tag than the used options. New step vans range from $50,000 - $80,000, depending on several factors, which we will discuss below.
- Full factory warranty - bumper to bumper
- Reduced downtime (brand new vehicle, so essentially nothing should go wrong)
- No previous vehicle maintenance history
- Brand new - essentially zero miles
- Finance term is longer
- Potentially lower finance rates on new step vans
- Nationwide delivery from MAG Trucks
- Cost (but with the higher price tag comes owner peace of mind that the truck is covered under warranty, and should have few issues, to begin with)
- The potential lead time of receiving a new step van
- If an issue arises, a disadvantage could be dealing with OEM and the certified service department's lead time
- If your maintenance hubs for warranty work are not within your immediate area, you may have to travel to reach one.
Used Step Vans are the most cost-conscious options, as the price range is between $20,000 - $40,000. See the pros and cons listed below.
- Cost (lower cost upfront)
- 3rd party warranty options
- MAG Trucks is a preferred trusted vendor
- Better chance for finance approval due to the lower principal amount
- MAG Trucks offers a nationwide delivery
- More variety for maintenance hubs
- Faster turnaround time, as MAG Trucks has a lot of used truck options
- View inventory and truck-specific truck information online
- Unsure of potential vehicle maintenance history
- Purchase of the step van does not include a factory warranty
- Niche market, resulting in harder to find used step vans
- Financing will typically be shorter terms
Who doesn't want to save money on business purchases? As peak season is quickly approaching, many ISP contractors are searching for step vans to add to their fleet. Be sure to take advantage of Section 179, which allows a business to deduct, for the current tax year, the full purchase price of equipment and off-the-shelf software that qualifies for the deduction. This equates to up to $1 million in eligible equipment to be deducted, and the ‘total equipment purchased’ by a business cannot exceed 2.5 million in the current year (2019). Once the equipment purchased exceeds that number, the deduction reduces on a dollar for dollar basis.
When does the purchase need to be made to qualify?
The equipment must be purchased (or financed/leased) and placed into service between January 1 and December 31 of that year.
How Much Can An ISP contractor Save on Taxes in 2019?
This depends on the amount of qualifying equipment and software that the ISP contractor purchases and puts into use. Section 179 suggests a helpful calculator that will easily calculate your potential savings: https://www.crestcapital.com/tax_deduction_calculator?_ga=2.137708656.1168323662.1568993625-600756634.1512153110
What type of Equipment Qualifies?
Most tangible business equipment qualifies, as long as it was purchased between January 1 and December 31 of the tax year you are claiming. Examples of qualifying purchases include:
- Equipment (machines, etc.) purchased for business use
- Tangible personal property used in business
- Business Vehicles with a gross vehicle weight in excess of 6,000 lbs
- Computer “Off-the-Shelf” Software
- Office Furniture
- Office Equipment
- Property attached to your building that is not a structural component of the building (i.e.: a printing press, large manufacturing tools, and equipment)
- Partial Business Use (equipment that is purchased for business use and personal use: generally, your deduction will be based on the percentage of time you use the equipment for business purposes).
- Certain improvements to existing non-residential buildings: fire suppression, alarms and security systems, HVAC, and roofing.
As you spend some time comparing new and used step vans, make sure you have a list of what you value as the most important factors. Does price rank? Is the reduction of down time critical? Is maintenance hub proximity critical? Is turnaround time? The MAG Trucks website has all of our new and used step vans available to browse. Get started on a credit application now!