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Can freelancers deduct 6000 lb vehicles?

TL;DR

Freelancers can deduct the cost of vehicles over 6,000 pounds if used for business purposes, subject to certain limitations.

Detailed Answer

Freelancers can deduct the cost of vehicles over 6,000 pounds through Section 179 or bonus depreciation if the vehicle is used more than 50% for business purposes. The deduction is limited to the percentage of business use. For example, if a vehicle is used 70% for business, only 70% of the cost can be deducted. Additionally, the vehicle must be purchased and placed in service during the tax year. The deduction is subject to a maximum limit, which can vary annually.

Where to Put It on the Tax Form

Report on Form 4562, Depreciation and Amortization, and Schedule C, Line 13 for sole proprietors.

Real World Example

A freelance photographer purchases a 7,000-pound SUV for $50,000 and uses it 80% for business. They can deduct $40,000 (80% of $50,000) under Section 179, subject to annual limits.

Calculation Required

A calculation is required for this deduction.

Calculate the business use percentage of the vehicle's cost. For example, if the vehicle cost is $50,000 and business use is 80%, the deductible amount is $40,000.

Audit Risk & Documentation Tips

Maintain a mileage log to substantiate business use percentage. Keep purchase receipts and records of the vehicle's use. Be aware that high deductions relative to income may increase audit risk.

IRS Reference

IRS Publication 946, How to Depreciate Property; IRS Code Section 179

Relevant Industries

FreelancersSmall BusinessConsultantsReal Estate Agents

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Disclaimer: This is for informational purposes only and should not be construed as tax or legal advice. Always consult your tax advisor.

Page created on July 15, 2025

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