Scenario: John is going to buy my Range Rover for “business”
Can he send Jim USDC or does it have to be from his business account to count as a business write off?
Great question — and it’s smart to think about this upfront. If John wants the Range Rover purchase to qualify as a legitimate business expense (and potentially depreciate it under Section 179 or bonus depreciation), here’s what matters most:
✅ Key Requirements for a Business Write-Off
- The buyer must be a business entity (LLC, S Corp, etc.) or a sole proprietor with proper documentation.
- The payment must come from a business account — ideally a bank account or crypto wallet registered to the business.
- The vehicle must be used primarily for business purposes (over 50% use is the usual IRS threshold).
- Proper documentation is critical: Bill of sale, title transfer, and payment records should all reflect the business name.
💸 What About USDC?
- Yes, Akam can pay in USDC — crypto payments are valid as long as:
- The wallet sending the USDC is owned by the business (not his personal wallet).
- The transaction is clearly documented with date, amount, wallet addresses, and purpose.
- He records the fair market value in USD at the time of the transaction for tax purposes.
⚠️ If He Sends from a Personal Wallet…
Even if he “intends” it for business, the IRS may treat it as a personal purchase or a capital contribution to the business — which complicates the write-off and may disqualify it from immediate depreciation.
John: Hmm i’d have to create a crypto exchange account (with type business), deposit to it from my private wallet and transfer from there to Jim?
Exactly — that’s the cleanest way to preserve the business intent of the transaction and avoid IRS scrutiny. Here’s how John can structure it:
✅ Step-by-Step: Business Crypto Payment for Vehicle Purchase
- Create a Business Crypto Wallet or Exchange Account
- Must be registered under the business name (e.g., LLC or S Corp).
- Can be on platforms like Coinbase, Kraken, Binance.US, or a self-custody wallet with business documentation.
- Transfer USDC from Personal Wallet to Business Wallet
- This step essentially becomes a capital contribution to the business.
- Akam should document this internal transfer clearly (date, amount, purpose).
- Send USDC from Business Wallet to You (Ben)
- This is the actual business expense.
- The transaction record should show:
- Business wallet address
- Your receiving wallet address
- Date and amount
- Purpose: “Vehicle purchase – Range Rover for business use”
- Record USD Value at Time of Transfer
- For tax purposes, Akam must log the fair market value in USD of the USDC sent on that date.
- Ensure the Bill of Sale Reflects Business Buyer
- Use the business name on the bill of sale and title transfer.
- Include the crypto payment method and USD equivalent.
This setup protects John’s ability to write off the vehicle, especially if he plans to depreciate it or claim bonus depreciation.
