Asset Specific
Business Vehicle & IRS Auto Depreciation Calculator
Calculate IRS-compliant depreciation for business vehicles including cars, trucks, SUVs, and vans. Applies luxury auto limitations where required.
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IRS Auto Depreciation Rules — Section 280F
Business vehicles are generally 5-year MACRS property. However, passenger carsare subject to Section 280F "luxury auto" limitations that cap annual depreciation regardless of the vehicle's cost. Vehicles over 6,000 lbs GVW (SUVs, trucks, vans) are generally exempt from these caps.
| Year | Luxury Auto Cap (100% business) | Notes |
|---|---|---|
| Year 1 | $12,200 | Without bonus depreciation |
| Year 2 | $19,500 | DDB switching to SL |
| Year 3 | $11,700 | Continued straight line |
| Year 4+ | $6,960/year | Until fully recovered |
Mixed Personal & Business Use
Only the business-use percentage of a vehicle's cost is depreciable. Keep a mileage log to document business use. If business use drops below 50%, you must switch to the straight-line ADS method. Consider the standard mileage rate as an alternative to actual expense depreciation (57.5¢/mile in 2023).