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If you are buying a car for your business and have a limited liability company (LLC), you may want to buy the car in the name of the LLC. To do that, you’ll need to take the right steps.

How an LLC Can Help You Buy a Car 

Here are the steps you need to take to buy a car with an LLC:

1. Business Credit

If you have good business credit, you might be able to buy the car in the name of your business alone. If not, you might have to sign the loan deal yourself.

2. Track down a Bank

You’ll have to find a bank that will back the credit under an LLC name. Some places that sell cars have business finance departments that work with these types of loans.

3. Talk to Your Insurance Company 

Even if you only drive for work part of the time, your insurance company will probably want you to get car insurance.

4. Buy the vehicle!

Just go ahead and buy the car you want.

5. Register the Vehicle 

You must register the car in the name of the LLC. There may be state-specific rules, but you should probably bring a copy of the articles of organization for your LLC to your state’s DMV. Make sure to pay the registration fees with the business bank account.

6. Keep Records

Keep track of your miles and other costs for your car, which you should be able to subtract from your charges.

Why Should I Buy a Car from an LLC?

There are a few advantages to buying a car through an LLC:

1. Liability Protection 

If your business vehicle gets into an accident, your LLC’s liability policy should keep you from having to pay for your own medical or court costs.

2. Security

The LLC name will be on the title and other paperwork for the car, not your own, so if someone is looking for the owner of the car, they won’t find you.

3. Charge Allowances

You should be able to claim the cost of your car as a business expense. You’ll need to keep track of the vehicle’s miles and other costs.

The disadvantages of purchasing a vehicle through an LLC 

Commercial auto loans often have higher interest rates than personal loans, so the car may end up costing you more in the long run. The cost of insurance may also go up. Also, some states charge a local fee on cars every year, which will be an expense for the business.

Transferring Your Car to an LLC 

If you want to give your car to your LLC, you need to take a few more steps. First, you need to find out if your lender wants you to refinance your loan into a business car loan and if your LLC will be qualified.

Then you’ll need to move the car with a record of move, which is usually some kind of bill of sale. You should sign the bill of sale yourself, but if you are a member of the LLC, you can also sign it on behalf of the business.

Last but not least, you’ll have to get a new car title in the name of the LLC. You’ll do this at the state Department of Motor Vehicles (DMV). Then, you’ll register the car under the name of your company.

You should also check with your insurance company to see if you need business car insurance

In Conclusion

Buying a car through an LLC is easy and has a lot of perks. If you want, you can also move your own car to the business. But before you do either, you should talk to a tax expert to make sure it’s the best choice for your case.