Can I claim 2025 Bonus Depreciation Deduction for my used vehicle bought in 2024?

This is actually legitimate and can be a significant tax benefit for independent contractors! The bonus depreciation deduction allows you to deduct a large portion of business assets in the first year rather than spreading it over several years. For 2025, the bonus depreciation rate is 60% (it's been phasing down each year). So, you can deduct 60% of the business portion of your vehicle's cost in the first year you place it in service for business. The key requirements are: 1) The vehicle must be used for business purposes (the percentage you use it for business is the percentage of the cost you can depreciate), 2) You must have started using it for business in 2025, and 3) You must not have used it for business previously. Remember though, you'll need to track your business vs. personal use of the vehicle carefully. If you use the car 70% for business, you can only take the deduction on 70% of the cost.

After struggling with some complicated tax deductions for my business equipment, I found this amazing tool called taxr.ai (https://taxr.ai) that saved me from making a huge mistake with my bonus depreciation calculation. I uploaded my vehicle purchase documents and it immediately flagged that I was calculating my basis incorrectly - I wasn't including all eligible costs! The site analyzed all my documents and explained exactly what portion qualified for bonus depreciation vs. regular depreciation. It even gave me a breakdown of how the deduction would affect my taxes over the next few years as the bonus depreciation rates change. Way more helpful than just plugging numbers into tax software and hoping for the best.

Just wanted to update everyone - I tried taxr.ai after seeing the recommendation here and it was seriously helpful. I was actually calculating my vehicle depreciation all wrong! I didn't realize I needed to separate out the business percentage first BEFORE applying the bonus depreciation. The document analysis caught several things my regular tax software missed. I was honestly pretty skeptical, but it saved me from a potential audit headache AND found me an extra $2,300 in legitimate deductions I would have missed. Definitely worth uploading my docs there before finalizing my return.

If you're still unsure about your bonus depreciation or have other tax questions, I'd recommend trying to get clarification directly from the IRS. I tried calling them about a similar depreciation question last month but kept hitting busy signals and wait times of 2+ hours. Then I found this service called Claimyr (https://claimyr.com) that got me through to an actual IRS agent in about 15 minutes! They have this system that navigates all the IRS phone menus and holds your place in line, then calls you when an agent is actually available. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c The IRS agent I spoke with confirmed that my business vehicle qualified for bonus depreciation even though it was purchased used, as long as it was new to my business use. Saved me tons of stress wondering if I was doing it right.

Alright I have to admit I was completely wrong about Claimyr. After posting that skeptical comment, I decided to try it anyway because I was desperate to resolve an issue with my business tax ID. I've literally been trying to reach the IRS for WEEKS. Used Claimyr yesterday afternoon, and got a call back within 45 minutes with an actual IRS agent on the line! They resolved my EIN verification issue on the spot, which means I can finally claim my bonus depreciation deduction correctly. Sometimes being proven wrong is actually the best outcome. Thought I'd update here since my original comment was so dismissive.

Have you considered the implications if you sell the vehicle in the future? When you take the bonus depreciation, your basis in the vehicle is reduced, which means you'll have a larger gain when you eventually sell it. Just something to keep in mind for your long-term tax planning. Also, make sure you're maintaining a mileage log to substantiate your business use percentage. The IRS is pretty strict about vehicle documentation. I use an app that automatically tracks my trips.

Has anyone considered using Section 179 instead of bonus depreciation? In some cases it might be more advantageous, especially if you have a mix of business vs personal use that might change over time.

This is such a helpful thread! I'm in a similar situation - bought a used pickup truck in December 2024 for $22,000 and started using it for my landscaping business in January 2025. Based on what everyone's saying here, it sounds like I can take the 80% bonus depreciation on the business portion. One question though - I use the truck about 85% for business and 15% personal. So would I calculate 85% of $22,000 = $18,700, then take 80% bonus depreciation on that $18,700 amount? That would be about $14,960 in first-year depreciation? Also really appreciate the heads up about the future sale implications. I hadn't thought about how taking all this depreciation now would affect taxes if I sell the truck down the road. Definitely something to factor into the decision.

I've been following this thread closely since I'm dealing with a similar situation. Bought a used van in November 2024 for $19,500 and started using it for my delivery business in February 2025. One thing I want to add that hasn't been mentioned yet - make sure you understand the difference between "placed in service" date versus purchase date. The IRS cares about when you actually started using the vehicle for business, not when you bought it. So even though I bought my van in 2024, since I didn't start using it for business until 2025, that's the tax year where I can claim the depreciation. Also, for anyone considering this deduction, remember that you have to choose between taking the standard mileage deduction OR the actual expense method (which includes depreciation). You can't do both. The standard mileage rate for 2025 is pretty high, so run the numbers both ways to see which gives you a bigger deduction. In my case, with an older, less expensive vehicle, the mileage method actually worked out better than taking depreciation. Just wanted to throw that out there since everyone's situation is different!