What Vehicles Qualify For Bonus Depreciation

What Vehicles Qualify For Bonus Depreciation.Bonus depreciation is a tax incentive that allows businesses to deduct a larger portion of the cost of qualifying property in the year it is placed in service. In general, vehicles used for business purposes may qualify for bonus depreciation, but there are certain criteria that must be met. Here are some of the requirements for a vehicle to be eligible for bonus depreciation:

What Vehicles Qualify For Bonus Depreciation.

  1. The vehicle must be new and not previously used by anyone else.
  2. The vehicle must be purchased and placed in service between September 27, 2017, and January 1, 2023.
  3. The vehicle must be used for business purposes at least 50% of the time.
  4. The vehicle must be depreciable under the Modified Accelerated Cost Recovery System (MACRS) with a recovery period of 20 years or less.
  5. The original use of the vehicle must begin with the taxpayer claiming the bonus depreciation.
  6. The vehicle must not be used for personal purposes more than 50% of the time.

It’s important to note that passenger automobiles are subject to different rules and limitations, depending on their weight and the year they were placed in service. Additionally, bonus depreciation rules and requirements may change over time, so it’s always best to consult with a tax professional for specific guidance on your situation.

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