Legal Question in Business Law in Maine

We operate a business and we have a sub contractor. We took out a debt in our name to supply the sub contractor with a piece of equipment. The debt is $10,000.00. If the sub contractor makes the payments, who can claim the equipment on thier taxes?


Asked on 2/09/10, 5:37 pm

1 Answer from Attorneys
Jerome Gamache Ainsworth Thelin & Raftice, P.A.

That is a tax question, not a legal question. However, you may want to be sure your sub contractor is really independent and cannot be classified as an employee since it is "using" your equipment. A simple written lease might be a good idea to document the relationship. The debt payments made by the sub contractor to the creditor are essentially income to you, and would be offset by the expense of the debt service.

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Answered on 2/15/10, 6:31 am


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