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Can you write off business vehicle over 6000 pounds?

TL;DR

Yes, you can generally write off the cost of a business vehicle over 6,000 pounds using Section 179 or bonus depreciation, but it must be used primarily for business purposes, and there are specific limits and conditions to consider.

Detailed Answer

Vehicles over 6,000 pounds are eligible for a larger Section 179 deduction, allowing you to deduct up to $28,900 in 2023 if the vehicle is used more than 50% for business. Additionally, bonus depreciation may allow for a 100% deduction of the vehicle's cost in the first year. However, the vehicle must be used primarily for business, and personal use must be accounted for separately. If the business use drops below 50%, you may have to recapture some of the deduction. Examples include a delivery truck used by a catering business or an SUV used by a real estate agent. It's important to note that luxury vehicles have different limits, and the vehicle must be placed in service during the tax year to qualify.

Where to Put It on the Tax Form

Schedule C, Line 13 for depreciation and Section 179 expenses. Form 4562 is used to calculate and report the deduction.

Real World Example

A real estate agent purchases a new SUV for $60,000, which is over 6,000 pounds. They use it 80% for business purposes. They can elect to take a Section 179 deduction of $28,900 and apply bonus depreciation to the remaining business-use portion, allowing them to deduct a significant portion of the vehicle's cost in the first year.

Calculation Required

A calculation is required for this deduction.

To calculate the deduction, determine the business-use percentage of the vehicle. Multiply the total cost of the vehicle by this percentage to find the business-use portion. Apply the Section 179 limit to this amount, then apply bonus depreciation to any remaining business-use cost.

Audit Risk & Documentation Tips

Moderate audit risk. Keep detailed mileage logs, purchase receipts, and records of business use versus personal use. Ensure the vehicle is titled in the business's name if possible. Maintain records for at least three years after the tax year in which you claim the deduction.

IRS Reference

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

Relevant Industries

FreelancersReal Estate AgentsConsultantsConstruction Contractors

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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 25, 2025

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