Are you in need of additional tax deductions for 2022?
Do you require a replacement vehicle?
If so, get your new vehicle in service on or before December 31, 2022; you can simultaneously fix the first problem (needing more deductions) and the second one (needing a replacement vehicle).
Drive the vehicle at least one business mile by December 31, 2022, at the very latest, to ensure compliance with the “placed in service” regulation. To qualify for significant deductions, you must both own and use the car for business.
Let’s talk about tax deductions now that you know the fundamentals.
1. Purchase an SUV, crossover vehicle, or van, new or used:
Suppose you or your business purchase and put into service a new or used SUV or crossover that the manufacturer classifies as a truck with a gross vehicle weight rating (GVWR) of 6,001 pounds or more on or before December 31, 2022. You get four advantages from this just-purchased car.
- The option to choose 100% bonus depreciation
- Using the five-year table to choose Section 179 expensing for up to $27,000 in MACRS depreciation
- Vehicle depreciation deductions are not subject to luxury limits.
For example: You purchase and put into service a $50,000 used SUV that meets the requirements on or before December 31, 2022, and you can deduct 90% of its costs for business usage. (90 percent x $50,000) Your company’s cost is $45,000. For 2022, you can deduct a maximum of $45,000.
2. Purchase a new or utilized pickup:
If you or your company purchases and puts into service a qualifying pickup truck (new or secondhand) on or before December 31, 2022, you will receive the following four significant benefits:
- Bonus depreciation of as much as 100%
- Expensing under Section 179 utilizing the five-year table for MACRS depreciation up to $1,050,000
- Vehicle depreciation deductions are not subject to luxury limits.
The pickup vehicle must meet certain criteria to be eligible for full Section 179 expensing.
- A cargo space (often referred to as a “bed”) with an interior length of at least six feet and a gross vehicle weight rating (GVWR) of more than 6,000 pounds.
Tax law designates a pickup truck as an SUV if it meets the more-than-6,000-pound GVWR requirement but fails the bed-length criteria. The car is still eligible for 100% bonus depreciation or expenses up to the $27,000 SUV expensing limit.
To learn about how you can take advantage of these deductions and get your new vehicle by the end of the year? ->Schedule Your Free Car Tax Deduction Assessment Here Today!<-
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