What Is Section 179 & What Does It Mean For You?
As a business owner, having a good grasp of various tax laws is imperative as being wise to the various tax laws can save business money and help you understand how to get special tax benefits. Section 179 of the United States tax law states that a business can deduct up to the total purchase price of a new or used vehicle that has a Gross Vehicle Weight Rating (GVWR) of 6,000 lbs or more and is used for business purposes more than 50% of the time.
Section 179 Deductions & Limitations
New rules for the 2023 tax year allow businesses to write off as much as 1,160,000 dollars worth of vehicles, equipment, and software used by and for the company. Section 179 is crucial for small and medium-sized businesses, but the tax law has a couple of main limitations.
- The amount of money deducted can not be more than the income of the business owner’s trades or the total businesses they own.
- If the qualified assets the business owner puts into effect during the taxable year exceeds $2.89 million, including inflation indexing, the deduction allowance phases out.
What Vehicles Does Section 179 Apply To?
Keep in mind Section 179 allows for business owners to deduct the purchase price of both new and used vehicles and equipment, whether financed, leased, or purchased in full.
What vehicles qualify for a 100% tax deduction at Chrysler Dodge Jeep Ram of Marysville?
- Ram 1500 (some 1500 models with a GVWR of less than 6,000 lbs are only subject to a value loss deduction and not a purchase price deduction)
- Ram 1500 Classic
- Ram 2500 & 3500
- Ram 3500, 4500, & 5500 Chassis Cab
- Ram ProMaster
Certain Jeep vehicles qualify for up to 80% of the total purchase price deduction:
- All 2023 models with available max towing package
- 2023 models with 3.0-liter EcoDiesel V6
- Grand Cherokee (2 and 3-row)
- All 2023 and 2024 trim levels, including 4xe
- ‘23 and ‘24 Rubicon 392
- 4xe models
- 2023 3.6-liter Rubicon 4-door with Xtreme Recon Package
While the information in this article is intended to educate readers with factual information, it should not be used in place of a discussion with your sales representative and a licensed tax professional to have all of the relevant facts and information presented to you to understand all about Section 179 fully. Tax law can be challenging to comprehend, and this article is for simple guidance only and not to be used in place of an expert’s advice.
Rairdon’s Chrysler, Dodge, Jeep, and Ram of Marysville are proud to offer the best prices on nearly a thousand new and used vehicles. Our talented sales team and finance department will work hard to ensure you get the best possible price. And our fantastic service department will work tirelessly to ensure your vehicle stays in the best condition possible.