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Can I deduct cars over 6000 pounds?

TL;DR

Yes, vehicles over 6,000 pounds can be deductible under certain conditions, but there are specific rules and limits to consider, such as the Section 179 deduction and bonus depreciation.

Detailed Answer

Vehicles over 6,000 pounds can qualify for the Section 179 deduction, allowing businesses to deduct the full purchase price of qualifying vehicles used for business purposes. However, there are limits; for example, the maximum deduction for SUVs is capped at $28,900 for 2023. Additionally, bonus depreciation may apply, allowing further deductions. To qualify, the vehicle must be used more than 50% for business. Passenger vehicles, including SUVs and trucks, must weigh over 6,000 pounds but less than 14,000 pounds to qualify. It's crucial to maintain accurate records of business versus personal use, as only the business-use portion is deductible.

Where to Put It on the Tax Form

Schedule C, Line 13 for depreciation and Line 24a for car and truck expenses.

Real World Example

A real estate agent purchases a new SUV for $60,000, which is used 80% for business. They can claim a Section 179 deduction up to $28,900 and apply bonus depreciation on the remaining business-use portion, maximizing their deduction in the first year.

Calculation Required

A calculation is required for this deduction.

To calculate the deduction, determine the business-use percentage (e.g., 80%), apply the Section 179 limit (e.g., $28,900 for SUVs), and calculate any additional bonus depreciation on the remaining business-use portion of the vehicle's cost.

Audit Risk & Documentation Tips

Moderate audit risk. Maintain detailed mileage logs, purchase receipts, and records of business versus personal use. Ensure documentation supports the business-use percentage claimed and keep records for at least three years.

IRS Reference

IRS Publication 946, How to Depreciate Property; IRC §179

Relevant Industries

Real Estate AgentsConstruction ContractorsConsultantsFreelancers

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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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