Ronald W. Stokes, CPA, PC

850 Corporate Parkway, Suite 120, Birmingham, AL 35242 205-437-0131; rwstokes@rwscpa.com

2018 Car & Truck Depreciation Limits

2015-subaru-impreza-sedan-and-hatchback-1First Year Limits

For passenger automobiles, and light duty trucks and vans, placed in service during calendar year 2018, the depreciation limit is $10,000 for the first tax year, plus an additional $8,000 if bonus depreciation is elected.

Limits After First Year

For passenger automobiles and light duty trucks and vans, the limits are $16,000 for the second tax year, $9,600 for the third tax year, and $5,760 for each successive tax year.

Larger Vehicles

SUVs, trucks and vans with a gross vehicle weight rating above 6,000 lbs. are not subject to depreciation limits. They are, however, limited to a $25,000 IRC §179 deduction. IRC § 179(b)(5)(A). No depreciation or §179 limits apply to SUVs with a GVW more than 14,000 lbs. Trucks and vans with a GVW rating above 6,000 lbs. but not more than 14,000 lbs. generally have the same limits: no depreciation limitation, but a $25,000 IRC §179 deduction. These vehicles, however, are not subject to the §179 $25,000 limit if any of the following exceptions apply:

  • The vehicle is designed to have a seating capacity of more than nine persons behind the driver’s seat;
  • The vehicle is equipped with a cargo area at least 6 feet in interior length that is an open area or is designed for use as an open area but is enclosed by a cap and is not readily accessible directly from the passenger compartment; or
  • The vehicle has an integral enclosure, fully enclosing the driver compartment and load-carrying device, does not have seating behind the driver’s seat, and has no body section protruding more than 30 inches ahead of the leading edge of the windshield.

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This entry was posted on March 28, 2017 by .
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