Section 179 Deduction Vehicle List For 2023

Section 179 deductions for vehicles are a tax provision that allows businesses to deduct the cost of qualifying vehicles in the year of purchase, rather than depreciating the expenses over several years. This deduction is designed to incentivize business investment in vehicles and provide upfront tax savings.

Under Section 179 of the Internal Revenue Code, businesses can deduct the full cost of eligible vehicles that are used for business purposes. The deduction applies to both new and used vehicles, as long as they meet certain criteria.

To qualify for the Section 179 deduction, the vehicle must be used primarily for business purposes, such as transporting goods, visiting clients, or other work-related activities. It should not be used primarily for personal purposes.

The deduction limit for vehicles is subject to annual changes based on tax laws and regulations. In recent years, the maximum deduction limit has been set at a certain dollar amount, which may vary.

In this article we will delve into what vehicles qualify for a section 179 deduction in 2023

What Vehicles Qualify For Section 179 Deduction in 2023?

100% "Work-Use-Only" Vehicles:

Vehicles capable of accommodating nine or more passengers behind the driver's seat, such as hotel or airport shuttle vans, fall into this category.

Additionally, vehicles meeting the following criteria are considered 100% work-use-only vehicles:

• They have a fully enclosed driver's compartment/cargo area.

• There is no seating available behind the driver's seat.

• The body section does not extend more than 30 inches beyond the leading edge of the windshield. These are commonly referred to as classic cargo vans.

For such vehicles, a full deduction is usually applicable.

1. Heavy Construction Equipment and Machinery:

   Heavy construction equipment, machinery, forklifts, farm tractors, skid steers, and similar vehicles typically qualify for the Section 179 deduction.

2. "Singular Use" Business Vehicles:

   Business vehicles intended for singular use, such as ambulances or hearses, generally qualify for a full deduction if there is no personal use involved.

3. Trucks and SUVs Over 6,000lbs GVWR:

   Trucks and SUVs with a Gross Vehicle Weight Rating (GVWR) exceeding 6,000 pounds can be eligible for a partial deduction. To qualify, the business use must be more than 50%. However, the deduction limits may vary based on the vehicle type.

   • Pickup trucks with a full-size (8') cargo bed generally qualify for a Section 179 deduction equal to the percentage of business use. For example, if a $60,000 truck is used 85% for business purposes, the deduction would be calculated as 85% of $60,000, resulting in $51,000.

   • Heavy SUVs are also eligible for a deduction based on the business-use percentage. However, the maximum deduction for 2023 is capped at $28,900.

   It is important to note that the vehicle must be used for business purposes at least 50% of the time. Additionally, if the vehicle is not used for business purposes 100% of the time, the depreciation limits are reduced proportionally according to the corresponding percentage of personal use.

   List of Heavy SUV’s and Trucks That May Be Eligible*

   *This list is compiled from various government databases and automotive databases which may contain inaccuracies. Please consult with a tax expert before making at decisions about your 2023 taxes

MAKE	MODEL	APPROX GVW (LBS)
Audi	Q7	6,900
Audi	SQ7	6,900
Audi	Q8	6,900
Audi	SQ8	6,900
BMW	X5 xDrive45e	7,165
BMW	X6 M50i	6,063
BMW	X7 xDrive40i	7,143
BMW	X7 M50i	7,143
BMW	X7 M50d	7,143
Bentley	Bentayga	7,275
Bentley	Bentayga Hybrid	7,165
Bentley	Bentayga Speed	7,275
Bentley	Flying Spur	6,724
Bentley	Flying Spur V8	6,724
Bentley	Flying Spur W12	6,724
Bentley	Mulsanne	6,173
Bentley	Mulsanne Speed	6,173
Bentley	Mulsanne Extended	6,617
Buick	Enclave Avenir AWD	6,160
Buick	Enclave Avenir FWD	6,055
Buick	Enclave Essence AWD	6,160
Buick	Enclave Essence FWD	6,055
Escalade	7,100
Cadillac	Escalade ESV	7,300
Cadillac	Escalade Platinum	7,100
Cadillac	Escalade ESV Platinum	7,300
Chevrolet	Silverado 2500HD	10,000
Chevrolet	Silverado 3500HD	14,000
Chevrolet	Silverado 4500HD	16,500
Chevrolet	Silverado 5500HD	19,500
Chevrolet	Silverado 6500HD	23,500
Chevrolet	Express Cargo Van 2500	8,600
Chevrolet	Express Cargo Van 3500	9,900
Chevrolet	Express Passenger Van	9,600
Chevrolet	Suburban	7,800
Chevrolet	Tahoe	7,400
Chevrolet	Traverse	6,160
Chrysler	Pacifica	6,055
Dodge	Durango	6,500
Dodge	Durango SRT	6,500
Dodge	Durango Citadel	6,500
Dodge	Durango R/T	6,500
Dodge	Durango GT	6,500
Dodge	Durango SXT	6,500
Dodge	Grand Caravan	6,055
Ford	Expedition	7,450
Ford	Expedition MAX	7,700
Ford	F-250 Super Duty	10,000
Ford	F-350 Super Duty	14,000
Ford	F-450 Super Duty	16,500
Ford	F-550 Super Duty	19,500
Ford	Transit Cargo Van T-250 HD	9,070
Ford	Transit Cargo Van T-350 HD	10,360
Ford	Transit Passenger Wagon	10,360
GMC	Sierra 2500HD	10,000
GMC	Sierra 3500HD	14,000
GMC	Sierra 3500HD Denali	14,000
GMC	Sierra 4500HD	16,500
GMC	Sierra 5500HD	19,500
GMC	Sierra 6500HD	22,900
GMC	Yukon	7,300
GMC	Yukon XL	7,800
Honda	Odyssey	6,019
Infiniti	QX80	7,385
Jeep	Grand Cherokee	6,500
Jeep	Grand Cherokee SRT	6,500
Jeep	Grand Cherokee L	6,500
Jeep	Wrangler Unlimited	6,500
Jeep	Gladiator Rubicon	6,250
Land Rover	Defender 110	7,165
Land Rover	Defender 90	7,055
Land Rover	Discovery	7,165
Land Rover	Discovery Sport	6,724
Land Rover	Range Rover	7,165
Land Rover	Range Rover Sport	7,165
Land Rover	Range Rover Velar	6,724
Land Rover	Range Rover Evoque	6,724
Land Rover	Range Rover Evoque R-Dynamic	6,724
Lexus	LX 570	7,000
Lincoln	Aviator	6,001
Lincoln	Navigator	7,200
Mercedes-Benz	GLS 580 4MATIC	6,768
Mercedes-Benz	GLS 600 4MATIC	6,768
Mercedes-Benz	G 550 4x4 Squared	7,057
Mercedes-Benz	GLS 580 4MATIC	6,768
Mercedes-Benz	GLS 600 4MATIC	6,768
Mercedes-Benz	AMG G 63 4MATIC SUV	6,724
Nissan	Armada 2WD/4WD	7,300
Nissan	NV 1500 S V6	8,550
Nissan	NVP 3500 S V6	9,100
Nissan	Titan 2WD S	7,300
Porsche	Cayenne Turbo Coupe	6,173
Porsche	Cayenne Turbo S E-Hybrid Coupe	6,173
Porsche	Cayenne Turbo S E-Hybrid	6,173
Porsche	Panamera Turbo S E-Hybrid	6,244
Tesla	Model X	6,000
Toyota	Tundra 2WD/4WD	6,800
Toyota	4Runner 2WD/4WD LTD	6,300
Depreciation Vs Deduction Under Section 179 Depreciation and full deduction are two different methods of accounting for the cost of vehicles under Section 179 of the tax code. Let's explore the distinctions between these approaches: Depreciation Depreciation refers to the gradual reduction in the value of an asset over time due to wear and tear, obsolescence, or other factors. In the context of vehicles, depreciation allows businesses to deduct a portion of the vehicle's cost as an expense over its useful life. This deduction is spread out across multiple years, following the depreciation schedule established by the Internal Revenue Service (IRS). Typically, vehicles are depreciated using the Modified Accelerated Cost Recovery System (MACRS), which assigns specific percentages for each year of the asset's recovery period. Full Deduction A full deduction, on the other hand, allows businesses to deduct the entire cost of a vehicle in the year it is placed into service for business purposes. Section 179 of the tax code provides this opportunity to incentivize business investments by allowing an immediate deduction of the vehicle's cost, rather than spreading it out over several years. The purpose of the full deduction is to stimulate economic growth by encouraging businesses to invest in assets that contribute to their operations. To qualify for a full deduction under Section 179, the vehicle must meet specific criteria defined by the IRS. These criteria can include factors such as the vehicle's weight, purpose, and business-use percentage. Certain types of vehicles, such as those primarily used for work-related transportation or carrying passengers, are more likely to be eligible for a full deduction. In summary, depreciation allows businesses to deduct the cost of a vehicle gradually over its useful life, while a full deduction enables the immediate deduction of the entire vehicle cost in the year it is put into service. The choice between depreciation and full deduction depends on various factors, including the type of vehicle, its purpose, and the business's financial objectives. Consulting with a tax professional or accountant can provide valuable guidance on which approach is most advantageous for a specific business. Conclusion In conclusion, Section 179 of the IRS tax code provides a significant incentive for businesses to invest in themselves by purchasing, financing, or leasing qualifying equipment and software. This provision allows businesses to deduct the full purchase price of qualifying equipment purchased or financed during the tax year, thereby reducing the overall cost of acquiring such equipment. However, it's important to note that while the Section 179 deduction can provide significant tax benefits, the specifics of this deduction can change from year to year. Therefore, businesses should consult with a tax professional or financial advisor to ensure they fully understand the current rules and regulations associated with Section 179. Vlad Zagranichny Previous Previous An Example Of Cost Segregation In Real Estate Next Next 1031 Exchanges in Maryland - What You Need To Know  10461 Mill Run Circle, Suite 720 Owings Mills, MD 21117 +1 410 902 0223 info@zagconsultgroup.com Securities offered through Avantax Investment ServicesSM, Member FINRA, SIPC. Investment advisory services offered through Avantax Advisory ServicesSM Avantax Advisors & Avantax Wealth Management