Need advice on Section 179 deduction for F-150 Lightning EV for small business use

Based on what you've described, I can help clarify how Section 179 would apply to your F-150 Lightning EV purchase. You're correct that the F-150 Lightning with its GVWR over 6,000 pounds but bed length under 6 feet puts it in a special category. This would classify it as a "heavy SUV" for tax purposes, which means it would be subject to the SUV limitation under Section 179. For 2025, that limit is $28,900 (it adjusts for inflation annually). The good news is that even with limited business revenue, you can still take advantage of Section 179 as long as the vehicle is used more than 50% for business. The deduction is based on the business use percentage, not your business revenue amount. So if you use it 75% for business, you'd multiply the eligible amount by 75%. Additionally, since it's an EV, you might qualify for the Clean Vehicle Credit (up to $7,500), but that's separate from Section 179 and has different requirements related to vehicle price caps and manufacturing requirements. For record-keeping: You'll need to track business vs. personal mileage meticulously to substantiate your business use percentage. I recommend a mileage log app or a dedicated notebook in your truck.

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One thing nobody has mentioned yet - if you're just starting out and only expecting a few thousand in revenue, have you considered just taking the standard mileage rate instead of actual expenses with depreciation? Way less paperwork, and might make more sense for your situation. For 2025, the business mileage rate is 70.5 cents per mile (might change, that's current rate plus inflation). So if you drive 5,000 business miles, that's a $3,525 deduction without tracking gas, insurance, etc. Won't help justify the fancy truck, but might be better tax-wise for your situation.

Has anyone mentioned the business income limitation for Section 179? You can't deduct more than your business income for the year. So if you only have $4k in business income, that's your maximum Section 179 deduction regardless of the vehicle cost.

This is exactly the kind of question I love seeing here! As someone who's helped several small business owners navigate vehicle deductions, I want to add a few practical considerations to the excellent advice already given. First, @Kingston Bellamy nailed the technical aspects, but let me add this: with only $3,500-4,500 in expected revenue, you might want to seriously consider the standard mileage rate that @Raul Neal mentioned. Here's why - even if you qualify for the full Section 179 deduction, you're limited by your business income. So you'd only be able to deduct $4,500 maximum in year one, with the rest carried forward. However, if you're confident your woodworking business will grow significantly in years 2-3, then taking the Section 179 approach makes sense because you can use those carryforwards. One thing I always tell clients: make sure you have a separate business bank account and keep immaculate records from day one. The IRS scrutinizes vehicle deductions heavily, especially for newer businesses. Document every business trip with date, destination, business purpose, and odometer readings. Also, since you mentioned this is currently a hobby, make sure you're operating with profit motive and treating it as a real business. The IRS has specific rules about hobby vs. business classification that could affect all your deductions. The F-150 Lightning is an awesome choice - just make sure the business case supports the tax strategy!