Article Date:
March 2019


Word Count:
986

 

 

IRS Saves Many Vehicles from the TCJA Bonus Depreciation Debacle


Imagine this: In 2018, you buy and place in service a $60,000 business car that you use 100 percent for business.

 

You don’t ELECT OUT of bonus depreciation, and you don’t choose Section 179 expensing (always worthless on luxury limited vehicles, as we explain below).

 

Without the new IRS rescue, your business car depreciation deductions would have looked like this.1

 

Year

Deductions

2018

$18,000

2019

$0

2020

$0

2021

$0

2022

$0

2023

$0

2024

$5,760

2025

$5,760

2026

$5,760

2027

$5,760

2028

and beyond

$5,760

until depreciated

 

Outraged

 

If this happened to you, you would be outraged. The IRS says it this way: “To mitigate the anomalous result … the IRS provides a safe harbor …”

 

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