Bonus Depreciation on Vehicles: Weight Limits, Stacking, and Recapture

Bonus depreciation on vehicles lets a business deduct a large share, and often all, of a qualifying vehicle’s cost in the year it goes into service instead of spreading the write-off over five or six years. For property placed in service in 2026, the deduction rate is back to 100%. What that means in dollars comes down almost entirely to one number on the door jamb: the manufacturer’s Gross Vehicle Weight Rating. Heavier vehicles above 6,000 pounds GVWR can often be written off in full in year one. Lighter vehicles are boxed in by Section 280F and capped at $20,300 in the first year for 2026, no matter what you paid.

The 6,000-Pound Weight Threshold

The most important factor in your first-year deduction is GVWR, which is the maximum loaded weight the manufacturer says the vehicle is designed to handle. It is printed on a sticker inside the driver’s door jamb. GVWR is not curb weight, and it is almost always higher. A sedan with a 4,200-pound curb weight might have a GVWR of only 4,900 pounds. An SUV with a 5,600-pound curb weight can carry a GVWR above 6,000.

Section 280F defines a “passenger automobile” as a four-wheeled vehicle made primarily for public roads and rated at 6,000 pounds unloaded gross vehicle weight or less (or gross vehicle weight for trucks and vans).¹ Passenger automobiles are subject to strict annual dollar caps. Anything above 6,000 pounds GVWR falls outside that definition and escapes those caps. Three tiers result:

Under 6,000 pounds GVWR. Subject to Section 280F annual caps. Most sedans, compact SUVs, and small crossovers land here.
6,001 to 14,000 pounds GVWR. Exempt from Section 280F caps. Many full-size SUVs, pickups, and cargo vans sit in this range. SUVs in this range face a separate Section 179 cap discussed below.
Over 14,000 pounds GVWR. No depreciation restrictions. Heavy-duty commercial trucks, buses, and specialty vehicles like food trucks qualify.²

The Section 280F Cap on Lighter Vehicles

If your vehicle’s GVWR is 6,000 pounds or less, Section 280F limits your annual depreciation regardless of the sticker price. For passenger automobiles placed in service in 2026, the caps are:

Year 1 with bonus depreciation: $20,300
Year 2: $19,800
Year 3: $11,900
Each year after: $7,160

Elect out of bonus depreciation and the first-year cap drops to $12,300. The later-year caps stay the same.³

Under this cap, sticker price barely matters for the year-one deduction. A $35,000 sedan and a $55,000 luxury car both max out at $20,300 in year one (assuming 100% business use). On the $55,000 car, you recover $20,300 in year one, $19,800 in year two, $11,900 in year three, then $7,160 per year until the basis is used up. That stretches beyond the normal five-year recovery period. The caps adjust for inflation each year.¹

What Heavier Vehicles Get

Vehicles over 6,000 pounds GVWR are not passenger automobiles under Section 280F, so the annual caps do not apply. A qualifying heavy vehicle used 100% for business can generally be written off in full in year one through bonus depreciation, or through a combination of Section 179 and bonus depreciation.

There is one catch for SUVs. Under Section 179, a sport utility vehicle with a GVWR between 6,000 and 14,000 pounds is subject to a separate dollar cap on the Section 179 portion of the deduction. For 2025 that cap is $31,300, and it adjusts for inflation.² The cap applies only to the Section 179 slice. Bonus depreciation on heavy vehicles has no such cap, so any basis remaining after Section 179 can be swept up by bonus depreciation. The SUV cap limits your flexibility between the two provisions, not your total first-year deduction.

Pickup trucks, cargo vans, and vehicles built for heavy commercial use with a full-size bed or no passenger seating behind the driver are generally not treated as SUVs for this purpose, so the SUV cap does not apply. Vehicles over 14,000 pounds GVWR have no Section 179 cap at all.

Business-Use Requirement

None of this is available unless the vehicle is used more than 50% for business in the year you put it into service.⁴ Above that threshold, the deduction scales with your actual business-use percentage. A vehicle used 75% for business gets a deduction based on 75% of the cost. At 100% business use, you deduct the full amount.

Business use is calculated by dividing business miles by total miles for the year.⁵ Commuting between home and a regular workplace does not count as business use, no matter how long the drive. Trips between work locations, client visits, and travel to temporary job sites generally do. An owner who drives 20,000 miles a year with 12,000 of those miles as commuting is at 40% business use and does not qualify for bonus depreciation at all.

Employees face a tighter test. An employee’s use of a vehicle counts as business use only if the employer requires the vehicle as a condition of employment and the use is for the employer’s convenience.¹ Choosing to use a personal car for work errands does not meet that standard.

Used Vehicles Qualify, and the Rate Is Back to 100%

Bonus depreciation is not limited to brand-new vehicles. Since 2017, used vehicles have qualified as long as five conditions are met: the vehicle was not previously used by you or a predecessor, you did not buy it from a related party, the purchase was a genuine arm’s-length transaction, you did not inherit the vehicle, and the cost does not include basis carried over from other property.⁶ Buying a used truck or SUV from a dealership or unrelated private seller ordinarily satisfies these. The vehicle just has to be new to you.

The One, Big, Beautiful Bill Act, signed into law on July 4, 2025, permanently restored the bonus depreciation rate to 100% for qualifying property acquired and placed in service after January 19, 2025.⁷ The previous phase-down (80% in 2023, 60% in 2024, and lower after that) is gone. Any qualifying vehicle placed in service in 2026 or later is eligible for 100% bonus depreciation with no scheduled sunset.

One boundary worth naming: leased vehicles do not qualify. Depreciation belongs to the owner, and in a lease that is the leasing company. Lessees can deduct lease payments as a business expense, but nothing in this article applies unless the business holds title to the vehicle.⁶

How Section 179 and Bonus Depreciation Stack

Section 179 and bonus depreciation are separate provisions that apply in a set order on the same vehicle. Section 179 comes first, reducing basis by the amount you elect to expense. Bonus depreciation then applies to what remains.² Several practical differences drive which lever to pull:

Section 179 is elective. You choose the amount. Bonus depreciation is automatic for qualifying property in a given asset class unless you affirmatively elect out.
Section 179 cannot create a loss. It is capped at your taxable income from active trades or businesses, and unused amounts carry forward.²
Bonus depreciation has no income limit. It can create or enlarge a net operating loss that carries forward, which makes it more useful in a low-income year.⁸
Section 179 has an overall dollar ceiling across all assets ($2,560,000 for 2026, phasing out above roughly $4,090,000 of qualifying property). A single vehicle rarely triggers this, but a big capital-investment year might.
An election out of bonus depreciation applies to every asset in the same class placed in service that year. You cannot cherry-pick one vehicle if another five-year asset went into service the same year.

Two Worked Examples

Heavy Vehicle Over 6,000 Pounds GVWR

A business buys a $78,000 full-size pickup with a GVWR of 7,500 pounds, uses it 100% for business, and places it in service in 2026. Because the truck is over 6,000 pounds, Section 280F caps do not apply. With 100% bonus depreciation available, the simplest path is to claim bonus depreciation on the entire $78,000. The full purchase price is deducted in year one.

If the same truck were used only 80% for business, the deduction would be $62,400 (80% of $78,000). The 20% personal share is never deductible.

Lighter Vehicle Under 6,000 Pounds GVWR

A business buys a $48,000 sedan with a 4,500-pound GVWR, used 100% for business, placed in service in 2026. Section 280F applies. Bonus depreciation is allowed, but the first-year deduction is capped at $20,300. The remaining $27,700 is recovered under the capped schedule: up to $19,800 in year two, $11,900 in year three, and $7,160 per year after that until the basis is fully recovered.³ The gap between a $78,000 first-year deduction and a $20,300 first-year deduction is what drives so many purchase decisions toward heavier vehicles.

Recapture

If Business Use Drops to 50% or Less

If the vehicle’s business use falls to 50% or below in any year during the MACRS recovery period, you must recapture prior accelerated depreciation, including bonus depreciation and any accelerated MACRS.¹ The recapture equals the difference between what you actually deducted and what you would have deducted under the slower Alternative Depreciation System. That excess is added back to income as ordinary income in the year business use drops. Going forward, you switch to ADS straight-line depreciation for the rest of the recovery period. This catches owners who buy a heavy SUV for a business that later winds down or who gradually shift the vehicle to personal use.

If You Sell the Vehicle

When you dispose of a business vehicle, all prior depreciation (Section 179, bonus, and regular MACRS) is subject to recapture under Section 1245. The gain treated as ordinary income is the lesser of total depreciation claimed or the gain on sale.⁹ The recaptured amount is taxed at ordinary rates, not capital gains rates.

The math can sting. Buy a $75,000 truck, deduct the full amount in year one, sell it three years later for $40,000, and your adjusted basis is zero. The entire $40,000 is gain, all of it ordinary income, because it falls within the $75,000 of depreciation claimed. Only proceeds above the original $75,000 cost could receive capital gains treatment. Sales and dispositions of business vehicles are reported on Form 4797.¹⁰

None of this makes bonus depreciation a bad deal. You took the deduction in year one when cash flow mattered, and the sale proceeds later help cover the recapture tax. Ignoring recapture during planning, though, produces unpleasant surprises.

Clean Vehicle Credits Reduce Depreciable Basis

If the vehicle is electric or plug-in hybrid, a Section 30D credit of up to $7,500 for a new clean vehicle, or a Section 45W credit based on a percentage of cost for a qualifying commercial clean vehicle, may also be available.¹¹ Claiming either credit reduces the vehicle’s depreciable basis. Section 30D requires a basis reduction equal to the credit and further requires that any deduction, including bonus depreciation, be reduced by the credit claimed.¹² Buy a $60,000 electric SUV and claim a $7,500 credit and the depreciable basis drops to $52,500. Bonus depreciation still applies, but only to the reduced basis. You keep both benefits, not on the same dollars.

State Conformity Is Its Own Question

Federal bonus depreciation is not the whole picture. Roughly two-thirds of states have historically decoupled from federal bonus depreciation, disallowing the same accelerated write-off on the state return. Several states issued new decoupling guidance after the One, Big, Beautiful Bill Act restored 100% bonus depreciation in 2025. The specifics vary: some states require a full add-back with an offsetting subtraction over later years, others simply require straight-line depreciation from the start. When the vehicle is later sold, the resulting basis differences between federal and state also flow through on the state return. If your business operates in a state with an income tax, check state conformity before assuming your state bill drops as much as your federal bill.

Records Are Not Optional

The IRS treats vehicles as listed property, which raises the documentation bar. A contemporaneous mileage log is the standard, and it needs to capture the date, destination, business purpose, and miles for every business trip.⁵ Contemporaneous means recorded at or near the time of each trip, not reconstructed at year-end.

Keep the purchase agreement, the window sticker or manufacturer documentation showing the GVWR, and your depreciation calculations. If business-use percentage shifts year to year, keep annual logs throughout the recovery period. Vehicle deductions are a routine audit target, and a missing or incomplete log can wipe out the entire deduction. On a $70,000 or $80,000 first-year write-off, that is a costly gap.

1
Office of the Law Revision Counsel. 26 USC 280F – Limitation on Depreciation for Luxury Automobiles
2
Internal Revenue Service. Instructions for Form 4562 (2025) – Introductory Material
3
Internal Revenue Service. Rev. Proc. 2026-15
4
CCH AnswerConnect. MACRS ADS and Depreciation Recapture Required if Passenger Automobile or Listed Property Used 50 Percent or Less for Qualified Business Use
5
Internal Revenue Service. Publication 463 (2025), Travel, Gift, and Car Expenses
6
Internal Revenue Service. Additional First Year Depreciation Deduction (Bonus) – FAQ
7
Internal Revenue Service. Interim Guidance on Additional First Year Depreciation Deduction Under Section 168(k)
8
Internal Revenue Service. One, Big, Beautiful Bill Provisions
9
Office of the Law Revision Counsel. 26 USC 1245 – Gain From Dispositions of Certain Depreciable Property
10
Internal Revenue Service. Publication 544 (2025), Sales and Other Dispositions of Assets
11
Internal Revenue Service. Topic G – Frequently Asked Questions About Qualified Commercial Clean Vehicle Credit
12
Office of the Law Revision Counsel. 26 USC 30D – Clean Vehicle Credit