How much can businesses deduct from their taxes using Section 179?

This Section 179 deduction limit amount changes from year to year to adjust for inflation. For 2023, the maximum Section 179 deduction is $1,160,000, an $80,000 increase from 2022. For 2023, the Section 179 spending cap for business purchases made from January 1 through December 31 is $2,890,000. If your business spends $2,890,000 or less on qualifying equipment in 2023, you are eligible for the full Section 179 deduction amount. The deduction limit is then reduced for every dollar your business spends on qualifying equipment beyond the $2,890,000 cap.

Which vehicles qualify for the Section 179 deduction?

The IRS breaks down the list of vehicles that qualify for a Section 179 deduction into three categories: Light, Heavy and Other. Light Vehicles – Vehicles with a gross vehicle weight rating (GVWR) under 6,000 lbs., such as passenger cars, crossover SUVs and small utility trucks. Heavy Vehicles – Vehicles with a GVWR of at least 6,000 lbs. but no more than 14,000 lbs., including many full-size SUVs, commercial vans and pickup trucks. Other Vehicles – Vehicles with a GVWR over 14,000 lbs. OR vehicles modified for work-centric, nonpersonal use. These include tractor trailers, cab and chassis, shuttle/passenger vans with at least nine passenger seats, cargo vans and “singular use” business vehicles. Learn More

Can my business use both a Section 179 and bonus depreciation deduction in the same tax year?

It is possible to claim both Section 179 and bonus depreciation deductions in the same tax year, but Section 179 deductions are typically taken first followed by bonus depreciation, if applicable or necessary. Learn More

How can I determine my potential tax savings from Section 179?

Use a Section 179 calculator, such as this one from Section179.org, which is updated to reflect the current 2023 limits and includes bonus depreciation. Calculate Now

Section 179 Tax Deduction

Deduct up to $1,160,000 in tax incentives on new or used trucks and trailers purchased, financed or leased and put into service by December 31, 2023.

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2023 Deduction Limit and Spending Cap

Now through December 31, 2023, eligible business owners can write off up to $1,160,000 using the Section 179 deduction for any new or used trucks or trailers purchased, financed or leased and put into service in 2023. A $2,890,000 maximum can be spent on eligible equipment before the available tax deduction is reduced.

Also, a 80% bonus depreciation is available for new and used equipment, after the spending cap has been reached. The bonus depreciation is retroactive to September 27, 2017, and good through 2023.

We encourage you to contact your tax advisor concerning the 2023 Section 179 deduction and specific qualification details.

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Learn More About the Section 179 Deduction

Section 179 is an immediate expense deduction that allows businesses and owner-operators to write off the entire value of qualifying business purchases to decrease their taxable income for the tax year in which the item was acquired and put into service. We covered everything you need to know about Section 179 and how it could benefit your business on The Long Haul blog.

This Section 179 deduction limit amount changes from year to year to adjust for inflation. For 2023, the maximum Section 179 deduction is $1,160,000, an $80,000 increase from 2022.

For 2023, the Section 179 spending cap for business purchases made from January 1 through December 31 is $2,890,000. If your business spends $2,890,000 or less on qualifying equipment in 2023, you are eligible for the full Section 179 deduction amount. The deduction limit is then reduced for every dollar your business spends on qualifying equipment beyond the $2,890,000 cap.
The IRS breaks down the list of vehicles that qualify for a Section 179 deduction into three categories: Light, Heavy and Other.
- Light Vehicles – Vehicles with a gross vehicle weight rating (GVWR) under 6,000 lbs., such as passenger cars, crossover SUVs and small utility trucks.
- Heavy Vehicles – Vehicles with a GVWR of at least 6,000 lbs. but no more than 14,000 lbs., including many full-size SUVs, commercial vans and pickup trucks.
- Other Vehicles – Vehicles with a GVWR over 14,000 lbs. OR vehicles modified for work-centric, nonpersonal use. These include tractor trailers, cab and chassis, shuttle/passenger vans with at least nine passenger seats, cargo vans and “singular use” business vehicles.
Learn More
It is possible to claim both Section 179 and bonus depreciation deductions in the same tax year, but Section 179 deductions are typically taken first followed by bonus depreciation, if applicable or necessary.

Learn More
Use a Section 179 calculator, such as this one from Section179.org, which is updated to reflect the current 2023 limits and includes bonus depreciation.

Calculate Now