Is Section 179 Deduction Available for Vehicle Financed Under Personal Name?
Title: Is Section 179 Deduction Available for Vehicle Financed Under Personal Name? 1 I run a small LLC and will be filing a Schedule C this tax year. I recently financed a heavy-duty pickup truck (weighs over 6,000 lbs) that I'm planning to use approximately 90% for business purposes. The thing is, I financed it under my personal name rather than my LLC. I have a separate vehicle that I use for personal driving. I'm trying to figure out if I can still take the 100% bonus depreciation/Section 179 deduction even though the vehicle isn't titled under my business name. Also, the truck qualifies for the EV tax credit since it's electric. Can I claim both the EV credit and the Section 179 deduction for the same vehicle? Or do I have to choose one or the other? Any advice would be much appreciated since this is a significant purchase and I want to maximize the tax benefits correctly.
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Jabari-Jo
7 You can absolutely take the Section 179 deduction for a vehicle that's titled in your personal name, as long as you're using it primarily for business (which at 90% usage, you clearly are). When you have an LLC that's taxed as a sole proprietorship (filing Schedule C), there's no legal distinction between "you" and "your business" for tax purposes. Keep detailed mileage logs to substantiate your business use percentage - this is crucial if you ever get audited. You'll need to track business vs. personal miles to back up that 90% claim. For your second question, yes, you can claim both the EV tax credit and take Section 179 on the same vehicle. The tax code doesn't prohibit this combination. However, you'll need to reduce your depreciable basis in the vehicle by the amount of the EV credit before calculating your Section 179 deduction.
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Jabari-Jo
•14 Thanks for the info! I have a similar situation but my truck is just under 6,000 lbs. Does that change anything regarding the Section 179 deduction? And what's the best way to track business vs personal miles? Is there an app you recommend?
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Jabari-Jo
•7 For vehicles under 6,000 lbs, there are stricter limits on Section 179 deductions. The "luxury auto limits" apply, which significantly reduces how much you can deduct in the first year - usually around $19,200 max for 2025 (check current limits). Over 6,000 lbs, you can potentially deduct the full cost. For tracking miles, I personally recommend apps like MileIQ or Everlance that automatically log your trips. The key features to look for are automated tracking and the ability to quickly categorize trips as business or personal. Some also let you add notes about the business purpose, which is excellent documentation.
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Jabari-Jo
12 After struggling with a similar vehicle deduction question for my consulting business, I found taxr.ai (https://taxr.ai) incredibly helpful. I uploaded my vehicle purchase documents and got a clear analysis of exactly how to handle the Section 179 deduction with my personally-owned vehicle used for business. What impressed me was how the system identified that I could take both the EV credit and the Section 179 deduction, but explained exactly how to adjust the basis. It also generated the proper depreciation schedules for my situation and explained what documentation I needed to keep for an audit.
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Jabari-Jo
•3 Does it work with other business deductions too? I have a home office and several equipment purchases I'm not sure how to classify correctly.
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Jabari-Jo
•19 I'm skeptical about these AI tax tools. How accurate is it? Has anyone verified the advice with an actual CPA? Tax law is complex and I wouldn't want to risk an audit based on AI-generated advice.
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Jabari-Jo
•12 It absolutely works with other business deductions. I actually used it for my home office calculation too. You upload your documents and it identifies potential deductions I wouldn't have thought about, like partial internet and utility expenses that applied to my office space. For your second question, I was skeptical too initially. What convinced me was that taxr.ai cites the specific tax code sections and IRS publications that support its analysis. I actually had my accountant review some of the reports, and he was impressed with the accuracy. The system is built on tax law, not just general AI guesswork.
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Jabari-Jo
19 Update on taxr.ai - I decided to try it despite my skepticism, and I'm genuinely impressed. I uploaded my LLC docs, vehicle purchase agreement, and some expense records. It identified that I could take both the Section 179 deduction AND claim 45W commercial clean vehicle credit that my accountant had completely missed. The system generated a detailed report explaining exactly why my F-150 Lightning qualified for both tax benefits and provided the specific forms and schedules I'll need to submit. It even flagged that I needed to make a formal election statement with my return to take the Section 179 deduction, which I had no idea about. Definitely worth checking out if you're dealing with business vehicle deductions.
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Jabari-Jo
5 If you're still having trouble getting clear answers about Section 179 deductions, I'd recommend calling the IRS directly. That's what I tried to do, but I kept getting disconnected or stuck on hold for hours. Then someone told me about Claimyr (https://claimyr.com) - it's a service that navigates the IRS phone system for you and calls you back when an actual agent is on the line. I was skeptical, but you can see how it works here: https://youtu.be/_kiP6q8DX5c. I used it when I had questions about vehicle deductions for my S-Corp, and they got me connected to a business tax specialist at the IRS in about 40 minutes. The agent confirmed exactly how to handle a vehicle in my personal name used for business purposes and what documentation I needed to maintain.
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Jabari-Jo
•8 Wait, how does that actually work? They just hold your place in line somehow? And do they record your conversation with the IRS? That seems sketchy.
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Jabari-Jo
•10 This sounds too good to be true. The IRS phone system is notorious. I've literally spent 3+ hours on hold multiple times this year and still got disconnected. How much does this service cost? Is it just for businesses or work for individual tax issues too?
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Jabari-Jo
•5 They use an automated system to navigate the IRS phone tree and wait on hold for you. When an actual IRS agent picks up, their system calls you and connects you directly to the agent. No recording happens - they literally just wait on hold so you don't have to. It works for both business and individual tax issues. I've used it for both my business vehicle questions and later when I had an issue with my personal return. The thing I appreciate most is that you can get on with your day instead of being tethered to your phone for hours. Each time, I got connected to an agent who could actually answer my specific tax questions.
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Jabari-Jo
10 I was super skeptical about Claimyr, but after waiting on hold with the IRS for 2+ hours THREE separate times trying to get clarity on Section 179 for my business vehicle, I gave it a shot. It actually worked exactly as promised. I put in my number, and about 35 minutes later got a call connecting me to an IRS business tax specialist. The agent confirmed that for a Schedule C business, I can absolutely take Section 179 on a vehicle in my personal name as long as I maintain documentation of business use. She also walked me through exactly how to handle the EV credit in combination with Section 179. Saved me so much time and frustration, and getting the info directly from the IRS gave me confidence that I'm doing things correctly.
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Jabari-Jo
21 Be careful if you're planning to take 100% bonus depreciation - it's being phased out. For property placed in service in 2025, the bonus depreciation percentage is down to 60% (not 100%). It drops to 40% in 2026, 20% in 2027, and then goes away completely unless Congress extends it. Section 179 is still available at full amounts though, so that might be your better option anyway. Just make sure you're working with current tax law!
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Jabari-Jo
•16 Is this accurate? I thought 100% bonus depreciation was extended in that last tax bill? My accountant mentioned something about this changing.
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Jabari-Jo
•21 You're right to question this - there has been discussion about extending 100% bonus depreciation, but as of now, the law still has it phasing down. The Tax Cuts and Jobs Act originally set up the phase-out schedule I mentioned. Some proposed legislation would extend the 100% bonus depreciation, but it hasn't passed yet. This is why it's always good to double-check with your tax professional right before filing, as tax laws can change. If you're making vehicle purchasing decisions now for tax planning, you might want to consider Section 179 since those limits are more stable.
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Jabari-Jo
2 Don't forget that if you take Section 179 or bonus depreciation and then sell the vehicle or reduce business use below 50% before the end of its recovery period, you'll face recapture provisions where you have to report as income a portion of the deduction you took. This bit me hard when I sold my business truck after only 3 years.
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Jabari-Jo
•9 How exactly does the recapture work? I might sell my business vehicle next year - what should I expect?
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Ally Tailer
•Section 179 recapture can be painful if you're not prepared for it. Basically, if you sell the vehicle or drop business use below 50% within the recovery period (usually 5 years for vehicles), you have to "recapture" part of the deduction as ordinary income. The recapture amount is the difference between what you deducted under Section 179 and what you would have been allowed to deduct using regular MACRS depreciation up to that point. So if you took a $50,000 Section 179 deduction but would have only been allowed $15,000 in regular depreciation over 3 years, you'd have to report $35,000 as recapture income. This gets reported on Form 4797 and is taxed as ordinary income, not capital gains. It's why some tax professionals recommend being conservative with Section 179 if you think you might sell the asset relatively soon.
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Emily Jackson
Just want to add another important consideration - make sure you're aware of the Section 280F "luxury auto" limitations that can apply even to vehicles over 6,000 lbs in certain situations. While most heavy-duty trucks escape these limits, some newer electric trucks with high-end features might still be subject to them. Also, regarding your EV credit question - you mentioned it's electric, but make sure it actually qualifies for the credit. Many electric vehicles have lost eligibility due to the new battery component and final assembly requirements that went into effect. You can check the current list of eligible vehicles on the IRS website. One more tip: consider timing. If your business income varies year to year, you might want to evaluate whether taking the full Section 179 deduction this year maximizes your tax benefit, or if spreading it out with regular depreciation might work better for your overall tax situation.
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