The Section 179 deduction for vehicles lets a business write off a large share of a qualifying vehicle’s cost in the year it’s placed in service, and for 2026 the amount hinges almost entirely on weight. Passenger cars and light trucks rated at 6,000 pounds or less are capped at $20,300 in total first-year depreciation. Heavy SUVs and trucks above 6,000 pounds get a $32,000 Section 179 cap, with the remaining cost eligible for 100% bonus depreciation. Vehicles above 14,000 pounds face no vehicle-specific cap at all, only the general Section 179 ceiling of $2,560,000.1Office of the Law Revision Counsel. 26 USC 179 – Election to Expense Certain Depreciable Business Assets All of this assumes you use the vehicle more than 50% for business.
Which Vehicles Qualify
The dividing line is gross vehicle weight rating (GVWR), which you’ll find on the manufacturer’s compliance label on the driver’s side door jamb. Section 280F uses that number to separate “passenger automobiles” from heavier vehicles that escape the strict luxury auto caps.2Office of the Law Revision Counsel. 26 USC 280F – Limitation on Depreciation for Luxury Automobiles; Limitation Where Certain Property Used for Personal Purposes
Some vehicles skip the weight test because their design limits personal use. Ambulances, hearses, and vehicles used in the business of transporting people or property for hire qualify regardless of weight. Heavy-duty pickups with a cargo bed at least six feet long that isn’t easily accessible from the passenger compartment are treated as trucks rather than passenger automobiles, which puts them on the more favorable side of the caps.
New and used vehicles both work, as long as the vehicle is new to your business. A two-year-old truck from a dealer is treated the same as one ordered from the factory.
The 50% Business Use Rule
The vehicle has to be used more than 50% for business in the year you place it in service. At or below that line, you lose access to both Section 179 and bonus depreciation entirely.
You prove the percentage with a contemporaneous mileage log: entries made at the time of each trip, not reconstructed at year-end. Each entry should show the date, destination, business purpose, and starting and ending odometer readings.3Internal Revenue Service. Publication 463 (2025), Travel, Gift, and Car Expenses Commuting between home and a regular office is personal mileage and doesn’t count toward business use.
Your business use percentage scales the deduction directly. A $70,000 truck used 80% for business gives you a depreciable basis of $56,000. Drop that to 55% and the basis falls to $38,500.
What You Can Deduct in 2026
Cars and Light Trucks at 6,000 Pounds or Less
Vehicles at or below 6,000 pounds fall under the Section 280F luxury auto caps, regardless of what the vehicle actually cost. For 2026, the maximum total first-year depreciation is $20,300 when bonus depreciation applies, or $12,300 when it doesn’t.4Internal Revenue Service. Rev. Proc. 2026-15 That ceiling covers Section 179, bonus depreciation, and regular MACRS depreciation combined. A $55,000 sedan used 100% for business still tops out at $20,300 in year one.
Heavy SUVs and Trucks Over 6,000 Pounds
This is where most owners find the best result. Vehicles above 6,000 pounds GVWR escape the passenger automobile caps but have their own Section 179 ceiling: $32,000 for tax years beginning in 2026.5Internal Revenue Service. Publication 946 (2025), How to Depreciate Property Whatever’s left after the $32,000 Section 179 amount is eligible for bonus depreciation.
Take an $80,000 SUV with a 7,200-pound GVWR used entirely for business. You claim $32,000 under Section 179, leaving $48,000 of basis. With 100% bonus depreciation, you deduct the full $48,000 as well, writing off the entire $80,000 in year one.
Vehicles Over 14,000 Pounds
Vehicles above 14,000 pounds GVWR are exempt from all vehicle-specific caps. The only limit is the general Section 179 ceiling of $2,560,000 for 2026, which begins phasing out dollar-for-dollar once your total Section 179-eligible equipment purchases for the year exceed $4,090,000.1Office of the Law Revision Counsel. 26 USC 179 – Election to Expense Certain Depreciable Business Assets Most box trucks, heavy commercial vehicles, and equipment haulers land here.
How 100% Bonus Depreciation Stacks On Top
The One Big Beautiful Bill Act, signed into law on August 5, 2025, permanently restored 100% first-year bonus depreciation for qualifying property acquired and placed in service after January 19, 2025. That replaces the earlier phase-down schedule, which had bonus at 60% for 2024 and heading lower. For vehicles placed in service in 2026, the bonus rate is 100% with no scheduled reduction.
For heavy vehicles above 6,000 pounds, bonus depreciation now absorbs whatever Section 179 doesn’t. A qualifying heavy vehicle used 100% for business can effectively be fully expensed in year one regardless of purchase price.
For lighter passenger automobiles, the effect is muted. The $20,300 total first-year cap under Section 280F includes both Section 179 and bonus depreciation, so the 100% rate doesn’t get you past that ceiling.4Internal Revenue Service. Rev. Proc. 2026-15
The Business Income Limit
Section 179 deductions can’t exceed your taxable income from the active conduct of a trade or business for the year. If your business nets $25,000 and you try to deduct $32,000, you’re limited to $25,000. The unused $7,000 isn’t lost. It carries forward to the next year, subject to the same income limit.1Office of the Law Revision Counsel. 26 USC 179 – Election to Expense Certain Depreciable Business Assets
This catches new businesses off guard. Bonus depreciation, unlike Section 179, isn’t subject to the taxable income cap and can create or deepen a net operating loss. For a first-year startup buying a heavy vehicle, leaning on bonus depreciation instead of Section 179 sometimes produces a better result.
You Give Up the Standard Mileage Rate
Claiming Section 179 on a vehicle permanently locks you out of the standard mileage rate for that vehicle in any future year. The IRS treats the two methods as mutually exclusive: once you take Section 179 or bonus depreciation, you have to use the actual expense method for as long as you own the vehicle.6Internal Revenue Service. Topic No. 510, Business Use of Car If your real expenses turn out lower than the mileage rate would have produced, there’s no switching back. Run both methods before you make the election.
If Business Use Drops Below 50% Later
The 50% test doesn’t end after year one. If business use falls to 50% or below in any year during the recovery period (typically five years for cars and light trucks), you trigger depreciation recapture. You calculate the difference between what you actually deducted under Section 179 and what you would have been allowed under the straight-line method, and report that difference as ordinary income.7Internal Revenue Service. 2025 Instructions for Form 4797 – Sales of Business Property
The calculation goes in Part IV of Form 4797.8Internal Revenue Service. Form 4797 – Sales of Business Property The recaptured amount flows back to the same schedule where you originally took the deduction. For a Schedule C filer, it appears as other income on Schedule C. It isn’t a penalty; it’s the reversal of a deduction you weren’t entitled to keep. That said, adding $30,000 or more back into income two years after the fact still hurts.
Keep the mileage log current through the whole recovery period. If the IRS audits and you can’t prove business use exceeded 50% in a given year, they’ll treat it as having dropped below.
Leased Vehicles
Section 179 is only available when you own the vehicle. Under a standard operating lease, the vehicle isn’t your asset and you can’t expense its cost under Section 179, though you can deduct the business portion of the lease payments as an ordinary operating expense. A capital or finance lease, where you take on the risks and rewards of ownership and the vehicle sits on your balance sheet, may be treated as a purchase for tax purposes and could qualify. The structure of the agreement, not its title, controls.
Reporting It on Form 4562
The deduction goes on Form 4562, Depreciation and Amortization, filed with your business return. Vehicles are “listed property” under the tax code, so they’re reported in Part V rather than the general depreciation sections.9Internal Revenue Service. Instructions for Form 4562 (2025)
In Part V, Section A, you enter the make, model, and date placed in service. Business use percentage goes in Column (c), and the Section 179 amount you’re electing in Column (i). The Column (i) total flows to Line 29, then up to Line 7 in Part I, where it joins any other Section 179 deductions.
Where the deduction lands after that depends on your entity. Sole proprietors carry the total to Line 13 of Schedule C.10Internal Revenue Service. 2025 Instructions for Schedule C (Form 1040) C corporations report on Form 1120, S corporations on Form 1120-S. Partnerships pass Section 179 through to partners on Schedule K-1 rather than claiming it at the entity level.
State Rules May Differ
Not every state follows the federal Section 179 rules. Some cap their Section 179 deduction well below the federal amount, with certain states allowing as little as $25,000. Others decouple from federal bonus depreciation entirely, so a vehicle you fully expensed federally may still need to be depreciated over several years on your state return. Check your state’s conformity before assuming the federal write-off flows through.