OOn January 23, 2023, the Internal Revenue Services (IRS) department officially marked this year’s tax filing season. The residents in the United States will have until April 18 to submit their 2022 returns, and those who have successfully obtained extension applications have until October 16 to do so.
After three consecutive years of disruption caused by the COVID-19 pandemic, this year represents another step toward normalcy. Also, with the IRS expecting to receive more than 168 million individual tax returns, the agency has bolstered its ranks by adding more than 5,000 new phones. assistants and support staff to assist tax filers, using funds made available through the Inflation Reduction Act.
For those who run small businesses and have purchased a motor vehicle within the last year for that business, the Section 179 code can be a useful clause to take advantage of.
What is Article 179?
The Internal Revenue Code (IRC) states that Section 179 allows small businesses to take an immediate expense deduction for a depreciable asset instead of capitalizing and depreciating the asset over a period of time.
The purchase of a vehicle under this definition would qualify as a depreciable asset.
Which vehicles meet the requirements of Section 179?
In general, SUVs, Pickups and Vans that weigh more than 6000 pounds and have more than 50 percent commercial use qualify for at least a partial deduction.
Other vehicles that have no potential for personal use, such as hearses, ambulances, cargo vans and box trucks without passenger seats, also qualify.
Do used vehicles qualify?
Yes, used vehicles will also qualify for Section 179 as long as they are a new addition to the business.
time limits
It is also important to note that the vehicle must be used for the benefit of the business between 1/1 and 12/31 of the calendar year in which the cancellation is requested.
