Section 179
What is Section 179 and how does it work?
Would you like
to deduct the full purchase price of a new or used vehicle for your
business? Thanks to Section 179 of the IRS tax code, you
can!
If you buy or lease a qualifying vehicle, you
can deduct the ENTIRE PURCHASE PRICE from your gross income. Section
179, once known as the "SUV Tax Loophole", was created by the US
Government to encourage business owners to invest in vehicles. Some
changes since its inception have now made Section 179 especially
beneficial for small businesses. Although large businesses still benefit
from it, Section 179 Deduction provides tax relief and gives business
owners actual benefits.
How does Section 179 deduction work?
In the past when a business would write off the purchase of a vehicle, they would write the cost off a little at a time, year-by-year, through the depreciation. However, business owners always preferred the freedom of being able to write off the entire auto purchase price during the year they invested in the vehicle, and Section 179 enables business owners to do just that-it enables businesses to write off the entirety of the vehicle purchase price for the current tax year. BP Ford works with businesses to help them qualify for section 179, and our knowledgeable team will also explain any limitations that may apply to your case.
