Depreciation of SUV > 6,000 lb. GVW

Forum|Forum|4 years ago
March 3, 2022
1 reply
8 views

I have a situation where a SUV > 6,000 lb. GVW was purchased in September, 2021, and used for business. They only drove 1,000 miles (90% business use), yet it seems that they can bonus depreciate/Sec 179 almost the entire purchase in 2021. What happens in future years when (if) business usage drops below the current 90%? It makes no sense to me that so much can be written off in 2021 with so little mileage driven, but I cannot find a single thing that contradicts this.

Any input/thoughts will be appreciated. Thanks.

Mike

ProSeries Professional

This topic has been closed for replies.

Best answer by dkh

You'll have an issue if business use drops below 50%. Then you have to deal with Sec179 recapture.

dkhAnswer

Level 15

You'll have an issue if business use drops below 50%. Then you have to deal with Sec179 recapture.

M

MikeB_CPAAuthor

Level 5

Thanks. That was my concern. Hopefully if that happens they will be someone else's client! 😂

Mike

abctax55

Level 15

@MikeB_CPA

Make sure (and get it in writing) your client understands that recapture possibility. I've explained it to clients, then when it IS time for recapture - they get upset. And they often take the return somewhere else.

(Hmmm - Maybe that's a good way to weed out some clients 🙂

HumanKind... Be Both

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