First-year business vehicle expensing, including the heavy-SUV cap and bonus depreciation
| Year | Overall §179 Limit | Phase-Out Begins At | Heavy-SUV Cap |
|---|---|---|---|
| 2026 | $2,560,000 | $4,090,000 | $32,000 |
| 2025 (post-OBBBA) | $2,500,000 | $4,000,000 | $31,300 |
| 2024 | $1,220,000 | $3,050,000 | $30,500 |
| 2023 | $1,160,000 | $2,890,000 | $28,900 |
The 2025 jump came from the One Big Beautiful Bill Act (July 2025), which reset the base limit to $2.5 million for tax years beginning after 2024 and indexed it from there. Amounts are dollar-for-dollar inflation indexed; the IRS revenue procedure each fall sets the next year's figures. Light vehicles (≤6,000 lbs GVWR) follow the separate luxury-auto caps instead: about $12,300 base first-year, $20,400 including bonus (2025 published; indexed for 2026).
| Class | Section 179 | First-Year Total with 100% Bonus | Examples |
|---|---|---|---|
| ≤ 6,000 lbs GVWR | Capped by luxury-auto limits | ≈ $20,400 | Sedans, hatchbacks, crossovers, compact SUVs |
| 6,001 – 14,000 lbs SUV | Capped at $32,000 (2026) | Full eligible basis | Full-size SUVs: Suburban, Tahoe, Expedition, Sequoia class |
| > 6,000 lbs, not an SUV | No vehicle cap | Full eligible basis | Pickups with 6+ ft bed and no rear seating; cargo vans with enclosed cargo area |
| > 14,000 lbs GVWR | No vehicle cap | Full eligible basis | Box trucks, heavy duty work trucks |
GVWR is on the certification sticker in the driver's door jamb, not the curb weight. Trim levels of the same model can straddle the 6,000-lb line, and the "SUV" definition in the statute (truck chassis or off-road-capable, seating in back) is why a no-back-seat cargo version of the same van escapes the cap. When the two caps differ, the IRS definition wins over the marketing brochure.
Section 179 lets a business expense qualifying property immediately instead of depreciating it over years. For vehicles, three numbers interact: the overall limit (reduced dollar-for-dollar once your total qualifying property passes the phase-out threshold), the vehicle-class cap, and bonus depreciation on whatever basis Section 179 didn't consume.
Eligible basis = price × business-use %. Effective §179 limit = overall limit − max(0, total qualifying property − phase-out threshold). §179 taken = min(effective limit, class cap, eligible basis), where the class cap is $32,000 for heavy SUVs (2026), zero-cap treatment for qualifying trucks and vans, and the luxury-auto cap for vehicles at or under 6,000 lbs. Bonus = (eligible basis − §179 taken) × bonus %. For light vehicles, the luxury-auto cap limits the total first-year deduction regardless of the split, which is the behavior the calculator enforces. Estimated tax value = first-year total × your marginal rate.
Enter the price from your purchase order, pick the class from the door-jamb GVWR sticker, and set your honest business-use percentage, measured by mileage log. Commuting never counts as business use. The cap-override fields exist because the IRS indexes these figures annually and the 2026 luxury-auto number should be confirmed when you file.
A $72,000 full-size SUV with 7,100 lbs GVWR, used 100% for business, placed in service in 2026. Section 179 gets capped at $32,000. The remaining $40,000 of basis goes to 100% bonus depreciation. First-year total: the full $72,000, worth $17,280 at a 24% marginal rate. Drop bonus to 80% and year one falls to $64,000 ($32,000 §179 + $32,000 bonus), with the last $8,000 depreciating over the MACRS schedule.
Two comparisons matter. The same $72,000 spent on a cargo van or a long-bed pickup with over 6,000 lbs GVWR skips the SUV cap: all $72,000 is Section 179-eligible, which doesn't change the federal year-one total while bonus is 100%, but matters enormously for state returns, since states like California don't conform to bonus depreciation and apply their own lower SUV cap. And a $72,000 crossover at or under 6,000 lbs GVWR gets roughly $20,400 in year one; the other $51,600 trails out over about five years of depreciation caps.
One more with a phase-down: an $88,000 heavy SUV at 85% business use in 2025 has $74,800 of eligible basis. §179 caps at $31,300, bonus covers the remaining $43,500, and the $74,800 first-year deduction is worth $16,456 at 22%.
For 2026 the overall Section 179 limit is $2,560,000, but vehicles face their own caps. Heavy SUVs rated 6,001 to 14,000 lbs GVWR are capped at $32,000 of Section 179 per vehicle. Vehicles over 6,000 lbs that are not SUVs, like pickup trucks with a 6+ foot bed or cargo vans with no seating behind the driver, avoid the SUV cap entirely. Passenger vehicles at or under 6,000 lbs are stuck with the luxury-auto limits, about $20,400 total in the first year including bonus depreciation.
$32,000 for 2026, up from $31,300 in 2025 and $30,500 in 2024. The cap in Section 280F applies only to vehicles with GVWR between 6,001 and 14,000 lbs that count as SUVs: built on a truck chassis or with features suited to off-road use. Basis above the cap can still be expensed with bonus depreciation, which is permanently 100% for property acquired after January 19, 2025.
Yes. The One Big Beautiful Bill Act restored 100% bonus depreciation permanently for qualified property acquired after January 19, 2025, ending the phase-down that had bonus at 60% for 2024 and 40% for 2025. For a heavy SUV, that means Section 179 up to the $32,000 cap plus 100% bonus on the remaining basis can still write off the full business portion in year one.
Vehicles over 6,000 lbs GVWR that are not SUVs get the cleanest treatment: pickup trucks with a 6-foot-or-longer bed and no seating behind the driver, and cargo vans with a fully enclosed driver's compartment. Heavy SUVs qualify but through the $32,000 Section 179 cap. Every vehicle needs more than 50% business use, and the deduction scales with your business-use percentage: at 85% business use, an $88,000 SUV has $74,800 of eligible basis.
No, and sometimes you shouldn't. Section 179 is elective and can be taken in part; anything you don't expense depreciates normally. If your business income is low this year, Section 179 can't create a loss, so a partial election plus bonus depreciation, or carrying deductions into higher-income years, can produce a better outcome. Bonus depreciation has its own flexibility and can be elected out by class. This is where a CPA earns their fee.