Section 179 Tax Deduction
Owners of small businesses are able to write off the purchase of qualifying vehicles on their taxes using the Section 179 deduction. In some cases, the entire price of a vehicle can be deducted while in others the deduction is capped at a certain amount. In either case, large and small businesses alike can utilize the Section 179 deduction and save big on their taxes. A wide variety of Ford vehicles in our inventory at D’Orazio qualify for the deduction. If you are looking for a new Ford truck, van, or SUV that qualifies for the section 179 deduction, reach out to the friendly folks over at D'Orazio Ford by calling (779) 232-4881 or check out our inventory in person at 1135 S Water St, Wilmington, IL 60481.
There are a lot of different qualifications a vehicle must meed in order to be deducted from taxes under Section 179. Below you will find a cheat sheet that helps you understand which vehicles qualify for the Section 179 deduction.
What is The IRS Section 179 Tax Code?
Section 179 deduction is a tax code that allows small businesses to write off the entire purchase price of a business vehicle providing that it meets certain qualifications. Before the introduction of section 179, small businesses would have to write off a percentage of depreciation year by year. Now businesses are able to write off the entire purchase price of a vehicle the year that it is purchased and put into service. This simplifies the depreciation deduction process for small businesses and helps them save on taxation expenses.
What Ford Vehicles Qualify For The Section 179 Tax Deduction?
There are a few different types of qualifications that a work vehicle must meet in order to qualify for the section 179 tax deduction. Different qualifications result in different tax write-offs that can be used for the purchase. For example, some vehicles qualify for a 100% deduction while others may only be eligible for a $25,000 deduction. It all depends on the type of vehicle as well as the gross vehicle weight rating or GVWR.
Here are all the Ford Vehicles that will qualify for the Section 179 work vehicle tax deduction along with what level of deduction they qualify for:
Ford Trucks That Qualify For Section 179 Tax Deductions
Ford pickup trucks fall into one of two categories. They will either qualify for the 100% depreciation deduction or the $25,000 depreciation deduction. Which one of these deductions the truck qualifies for depends on the size of the truck’s bed. If the truck has a bed length of over six feet and a gross vehicle weight rating of over 6,000lbs it qualifies for the maximum depreciation deduction of 100% of the purchase price. Trucks that qualify include the Ford F-150, Ford F-250, and Ford F-350 as long as the bed is over six feet in length.
If the bed is under six feet in length, the truck is considered a passenger truck and only qualifies for the $25,000 depreciation deduction. An example of a truck that qualifies for the $25,000 depreciation deduction is the Ford F-150 SuperCrew with a 5.5ft bed.
Ford Cargo/ Passenger Vans That Qualify For Section 179 Tax Deductions
Vans, like trucks, fall into one of two categories when it comes to qualifying for the Section 179 tax code. Which level of deduction they qualify for depends on the purpose of the van as well as the gross vehicle weight rating. If the van has a GVWR of over 6000lbs and is a cargo van, like the Ford F-250/ F350 Super Duty Transit Van, it qualifies for a deduction of 100% of the purchase price. Ford Passenger Vans that have a GVWR of over 6000lbs, such as the Ford Transit Wagon, qualify for a $25,000 depreciation deduction.
Cargo vans with a gross vehicle weight rating of under 6000lbs qualify for a tax deduction of $11,560. Ford cargo vans that qualify for this level of depreciation deduction include the Transit Connect Van and the Transit Connect Wagon.
Ford SUVs That Qualify For Section 179 Tax Deductions
When it comes to SUVs, there are also two different categories the vehicle can fall into. The first one is for SUV’s that have a gross weight rating of over 6,000lbs. These SUVs qualify for the $25,000 depriciation deduction. Ford SUVs that qualify for the $25,000 Section 179 tax deductions include the Ford Expedition and Ford Explorer. Any Ford SUV that has a GVWR of less than 6,000lbs only qualififes for a tax depreciation deduction of $11,160.
If you have any further questions about how the Section 179 Tax Deduction can help your business save money on taxes, give D’Orazio Ford at (779) 232-4881 and a friendly team member will be happy to assist you!