5 Tips for Getting an SUV Tax Deduction

January 27, 2012

The so-called SUV tax deduction section of the United States tax code, Section 179, allows small businesses and some individuals to write off certain expenses pertaining to SUVs. There are several requirements you'll have to meet before you'll be able to get a Pathfinder tax deduction or a Highlander tax deduction. So it's important you know exactly when and how you're allowed to write off expenses associated with these vehicles on your taxes before you make any purchase.

Number 1 -- Know the Section 179 Code

Section 179 of the tax code permits businesses to write off deductions associated with various purchases, including the purchase of SUVs. This code was introduced into the tax legislation as a means of encouraging economic growth and business involvement in the marketplace. Take the time to read over this section of the tax laws to get a sense for how to go about writing off the costs associated with an SUV. Know that, as of the last tax year, no more than $250,000 could be deducted per this tax code section and the total amount of goods purchased could not be more than $800,000 in cost.

Number 2 -- Personal Use vs. Business Use

If you have an SUV that meets the standards for Section 179 tax deduction, you'll have bought that SUV for a small business that you're involved with. The business can receive a deduction on the vehicle. However, any personal use of the SUV is not tax deductible. You'll have to be able to quantify the approximate percentage of use of the SUV for business purposes, as opposed to personal purposes to claim the proper deductions for the business.

Number 3 -- Weight Requirements

Be aware of the weight requirements for SUVs to receive tax deductions. Section 179 specifies that any SUV must weigh more than 6,000 pounds and less than 14,000 pounds in order to qualify for a tax deduction. If you're considering a smaller SUV to purchase, think again before you make your final commitment, as these vehicles do not qualify for tax deduction of this type.

Number 4 -- Special Clauses

There is a particular section of the Section 179 tax code that does allow for minor deductions for heavier SUVs. Specifically, if your vehicle weighs more than 14,000 pounds, you can still claim a tax deduction on that vehicle, but no more than $25,000 per year.

Number 5 -- Keep Track of Use

One of the most important things to keep in mind when preparing to make any tax deductions for a vehicle you drive, including a SUV, is you'll need to be able to provide concrete evidence of your use of the car for business purposes. Most commonly, this evidence takes the form of receipts from parking and gasoline purchases, as well as other paper documents. Be sure to file away everything you use for business purposes in case you are audited.

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