What Kinds of Vehicles Are Eligible for a Section 179 Tax Code Deduction?


Quick Answer

A car, truck, sport utility or crossover vehicle that an owner uses for qualified business purposes at least 50 percent of the time can qualify for a business expense deduction on her federal tax return through Section 179 of the Internal Revenue code, states Section179.org. New, used and leased vehicles are eligible for the deduction.

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Full Answer

Taxpayers can get a Section 179 deduction of up to $11,060 for cars and $11,160 for vans and trucks, as of 2015, according to Section179.org. Sport utility and crossover vehicles may qualify for deductions up to $25,000. To qualify for a $25,000 deduction, the vehicle must have a gross vehicle weight rating between 6,000 and 14,000 pounds.

Some vehicles, such as ambulances, hearses and taxis, have no limit to the deductible amount, notes Section179.org. Vehicles with modifications for business use can qualify for the full deduction, for example, if the owner removes passenger seating, installs storage space and brands the vehicle with a company logo. A vehicle also may qualify if it is unlikely to have a non-commercial purpose, such as a nine-passenger van or a vehicle with a separate cargo area at least 6 feet long.

The owner must buy and place any Section 179 vehicle in service prior to December 31 to qualify for the deduction for that year, states Section179.org. An owner cannot claim the deduction for a vehicle purchased for personal use in a prior year.

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