Does the depreciation apply to new car purchases only?
I’m planning to start driving for ride-share services in the future and was wondering if I could purchase a used luxury SUV in the future and follow the depreciation tax deduction outlined above. I current have a 10 year old hybrid SUV and would take the standard mileage deduction since I own the car and spent very little for maintenance/repair/fuel/insurance. A newer luxury SUV could allow me to drive for more lucrative services and to write off the depreciation could help a lot and encourage me to seek a bigger revenue to max the deductions.
Hey Kevin, great question! No, depreciation does not just apply to new vehicles. You can purchase a used vehicle and take a tax deduction as well. As far as your points on purchasing a more expensive vehicle, yes you could take a pretty large deduction in the first year of purchase under the Section 179 deduction. Check out our Car Depreciation article to see the qualifications.
Best of luck,
Crystalynn Shelton, CPA
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