At Kemna Auto Group in Algona, IA, we’re here to help you make smart decisions for your business—and that includes saving money. If you’re in the market for a vehicle that works as hard as you do, you need to know about the Section 179 tax deduction. This powerful tool lets business owners deduct the cost of qualifying vehicles, cutting your tax bill by thousands.
Here’s a simplified guide to Section 179 and how it can help you save big in 2024. For more information feel free to contact us!
What is Section 179?
Section 179 is a tax deduction that allows businesses to write off the cost of qualifying equipment, including vehicles, used more than 50% for business purposes. Whether you’re looking for a new truck, van, or SUV, this deduction could help lower your taxable income and put money back in your pocket.
For 2024, here’s what you could save:
- Light Vehicles (under 6,000 lbs GVWR): Deduct up to $12,400, or $20,400 with bonus depreciation.
- Heavy Vehicles (6,000–14,000 lbs GVWR): Deduct up to $30,500, plus 60% bonus depreciation.
- Specialized Vehicles (over 14,000 lbs or modified for business): Deduct 100% of the cost with no cap.
What Vehicles Qualify?
The IRS divides vehicles into three categories. Here’s a quick breakdown:
Light Vehicles:
- Cars, small trucks, and SUVs with a GVWR under 6,000 lbs.
- Deduction limit: $12,400 or $20,400 with bonus depreciation.
Heavy Vehicles:
- Larger SUVs, commercial vans, and trucks with a GVWR between 6,000 and 14,000 lbs.
- Deduction limit: $30,500, plus 60% bonus depreciation.
Specialized Vehicles:
- Delivery vans, work trucks, and other heavily modified vehicles with no personal use.
- Deduction: 100% of the cost, no limit.
Real-Life Example
Janine, a small business owner, bought a $55,000 truck in 2024 with a GVWR of 8,000 lbs. Since she uses it exclusively for her roofing business, it qualifies as a heavy vehicle. Janine can deduct up to $30,500 with Section 179, plus 60% bonus depreciation to lower her tax burden even more.
Want to find out how much you can save? We’re here to help you run the numbers.
How to Determine If Your Vehicle Qualifies
To check if your vehicle qualifies for Section 179:
- Find the GVWR: Look for the manufacturer’s label inside the driver’s side door.
- Check Usage: Your vehicle must be used more than 50% for business. Partial personal use? You may still qualify for a partial deduction.
Not sure where to start? Our team can help you navigate these details and find the perfect vehicle for your business needs.
Things to Keep in Mind
- Business Use Requirement: Vehicles must be used primarily for business. Mixed personal use? No problem—you’ll get a proportional deduction.
- Bonus Depreciation: Combine this with Section 179 to increase your savings, but note that it requires tracking actual expenses like fuel and repairs.
- Luxury Vehicle Caps: High-value luxury cars have lower deduction limits.
Why Kemna Auto Group?
At Kemna Auto Group, we’re more than just a car dealership—we’re your partner in success. Here’s why businesses in Algona, IA, trust us:
- Expert Guidance: We’ll help you understand GVWR, vehicle categories.
- Extensive Inventory: From compact SUVs to heavy-duty trucks, we’ve got a wide selection of eligible vehicles.
- Personalized Service: Our team will walk you through every step to ensure you drive away with the best vehicle for your needs.
Don’t Miss Out on 2024 Savings!
The Section 179 deduction is your chance to save big while investing in your business. Ready to get started? Visit Kemna Auto Group in Algona, IA, today. Let us help you find the perfect vehicle to drive your business forward.
Call us, visit our website, or stop by the dealership—we’re here to make 2024 your most successful year yet!
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