Business Vehicle Depreciation: 6,000-Pound Rule and Section 179 Caps

Business vehicle depreciation is the way you recover the cost of a work vehicle over several tax years instead of deducting the full price in the year of purchase, and how much you can write off each year turns almost entirely on one number: the vehicle’s gross vehicle weight rating. Vehicles rated at 6,000 pounds or less run into strict annual dollar caps under IRC Section 280F. Heavier vehicles avoid those caps and can qualify for a full first-year deduction, especially after the One, Big, Beautiful Bill Act permanently restored 100% bonus depreciation for qualified property placed in service after January 19, 2025.

Why the 6,000-Pound Line Matters

Gross vehicle weight rating (GVWR) is the maximum weight a vehicle can safely handle with frame, engine, fluids, passengers, and cargo included. It is not curb weight. You will find the GVWR printed on the Safety Compliance Certification Label, usually on the driver’s side door jamb or the door latch post pillar.

For tax purposes, 6,000 pounds is the dividing line. At or below that rating, your vehicle is a “passenger automobile” under Section 280F and faces the annual caps described below. Above it, the caps drop away and much larger first-year deductions open up. One wrinkle: for cars the IRS uses unloaded gross vehicle weight, while for trucks and vans it uses gross vehicle weight.¹ If your vehicle sits close to the threshold, verify the number on the manufacturer’s label before you pick a depreciation method.

Annual Caps for Vehicles at 6,000 Pounds or Less

Section 280F caps yearly depreciation on lighter vehicles regardless of purchase price. A $40,000 sedan and a $120,000 sedan hit the same ceiling. The IRS adjusts the caps for inflation. For vehicles placed in service during 2026, the limits are:²

Year 1 with bonus depreciation: $20,300
Year 1 without bonus depreciation: $12,300
Year 2: $19,800
Year 3: $11,900
Year 4 and each later year: $7,160

The years 2, 3, and later limits are identical whether or not you claimed bonus depreciation in year one. The only thing bonus depreciation changes is how much you can front-load. Electric vehicles and gas-powered cars sit under the same caps.

These limits do not stop at the end of the standard five-year MACRS recovery period. If cost basis remains, you keep deducting up to $7,160 per year (adjusted for business use) until it is used up. For an expensive car, depreciation can stretch past a decade. The base-year statutory amounts that get inflation-adjusted are $10,000 for year one, $16,000 for year two, $9,600 for year three, and $5,760 for each later year.¹

Heavy Vehicles: Section 179 and Bonus Depreciation

Vehicles with a GVWR above 6,000 pounds escape the Section 280F caps. Two provisions do the work: Section 179 expensing and bonus depreciation under Section 168(k).

Section 179

Section 179 lets you deduct part or all of a vehicle’s purchase price in the year you place it in service. For 2026, the overall Section 179 limit across all qualifying assets is $2,560,000, with a phase-out beginning at $4,090,000 in total qualifying purchases. A separate sub-limit hits SUVs: any four-wheeled vehicle designed primarily to carry passengers, rated above 6,000 pounds but at or below 14,000 pounds GVWR, is capped at $32,000 for the Section 179 deduction in 2026. Certain cargo vans, enclosed work trucks, and larger passenger shuttles are structured differently and can bypass the SUV sub-limit up to the overall Section 179 ceiling.³

100% Bonus Depreciation After the OBBBA

The One, Big, Beautiful Bill Act, signed on July 4, 2025, permanently restored 100% bonus depreciation for qualified property acquired and placed in service after January 19, 2025.⁴ For heavy vehicles, this reshapes the math. Bonus depreciation under Section 168(k) does not carry the Section 179 SUV sub-limit. A business buying a $75,000 SUV rated above 6,000 pounds GVWR can claim 100% bonus depreciation on the full $75,000 in year one, rather than being held to the $32,000 Section 179 SUV cap. Most buyers of heavy SUVs placed in service after January 19, 2025, will lean on bonus depreciation because it is more generous and simpler, though you can combine Section 179 and bonus depreciation on the same vehicle when the mix helps your return.

For lighter vehicles at 6,000 pounds or less, bonus depreciation still exists but remains capped by Section 280F. That is why the first-year cap with bonus depreciation is $20,300 rather than the full cost of the car.²

Leasing Doesn’t Get Around the Caps

Leasing a business vehicle instead of buying it does not sidestep the depreciation limits. Section 280F(c) requires lessees to add an “inclusion amount” to gross income each year to offset the larger lease deduction they would otherwise claim on a high-value car. It is the IRS clawing back part of the lease write-off so a lessee ends up in roughly the same place as a buyer who hit the depreciation caps.

For leases beginning in 2026, the inclusion amount kicks in when the vehicle’s fair market value exceeds $62,000.² Below that value, no adjustment is needed. Above it, you look up the vehicle’s value in Table 3 of Rev. Proc. 2026-15 to find the annual add-back. The amounts are small just above the threshold and grow with vehicle value; a vehicle worth $500,000 or more carries a first-year inclusion of $2,368, rising to $10,668 per year starting in year five.

If business use is under 100%, prorate both the lease deduction and the inclusion amount by the business-use percentage, and prorate for partial years by days in service. The inclusion applies for the entire lease term using the table in effect when the lease began.

Business Use Sets the Ceiling on Everything

Every depreciation method scales to the share of miles you drive for business. You need more than 50% qualified business use to claim Section 179, bonus depreciation, or accelerated MACRS. At 50% or below, you are limited to straight-line depreciation over a five-year recovery period.⁵

Depreciable basis starts with the purchase price, or the portion allocable to business use. Pay $50,000 for a vehicle and drive it 80% for work, and depreciable basis is $40,000. Each annual deduction is then multiplied by that same business-use percentage.⁵

The Mileage Log

The IRS expects a contemporaneous log: entries recorded close to when trips happen, not reconstructed at tax time. Each entry should include the date, destination, business purpose, and miles driven. Handwritten logs and mileage apps both work. Without one, the IRS can disallow the entire deduction rather than just trim it. A spreadsheet updated weekly takes minutes and can preserve thousands in deductions during an audit.

Standard Mileage Rate as an Alternative

Instead of tracking actual expenses and claiming depreciation, you can use the IRS standard mileage rate: 72.5 cents per mile for business driving in 2026.⁶ The rate folds depreciation, gas, insurance, and maintenance into one per-mile figure. You still need a log, but you skip the 280F caps, bonus depreciation math, and basis adjustments.

One catch: to use the standard mileage rate, you must choose it in the first year you place the vehicle in service for business. You can switch to actual expenses later, but you cannot switch back. For heavy vehicles where first-year bonus depreciation dwarfs the mileage deduction, actual expenses almost always win. For a moderately priced sedan driven heavily for work, the standard rate is simpler and sometimes larger.

What Happens If Business Use Drops Later

Aggressive first-year depreciation carries an obligation for the rest of the recovery period. If business use falls to 50% or less in any later year, you owe back a portion of what you already deducted. The excess is added to gross income for the year the drop occurs.⁷

The recapture amount is the gap between what you actually deducted (including any Section 179 and bonus depreciation) and what straight-line depreciation would have produced from the start. Expense $75,000 on a heavy SUV in year one using bonus depreciation, and if straight-line over five years would have yielded only $15,000 in deductions through year two, that $60,000 gap becomes taxable income if business use drops below the threshold in year two.⁵

Two things happen at the same time. You must switch to straight-line for the current year and all remaining recovery-period years, and your vehicle’s adjusted basis increases by the recapture amount, which reduces taxable gain on any later sale. Recapture goes on Form 4797, Part IV, and flows as “other income” onto whatever schedule carried the original deduction, typically Schedule C for sole proprietors.⁸ If the vehicle was used in an active trade or business, the recapture is also subject to self-employment tax.

Penalties for Getting It Wrong

Section 6662 imposes a 20% accuracy-related penalty on a substantial understatement of income tax, defined as an understatement exceeding the greater of 10% of the tax due or $5,000.⁹ Overclaiming depreciation on a $70,000 vehicle can easily cross that line. Misclassifying a vehicle’s GVWR to reach the heavy-vehicle rules, or claiming 100% business use without a mileage log, are the kinds of errors that draw this penalty on top of the additional tax and interest.

1
Office of the Law Revision Counsel. 26 USC 280F – Limitation on Depreciation for Luxury Automobiles; Limitation Where Certain Property Used for Personal Purposes
2
Internal Revenue Service. Rev. Proc. 2026-15
3
Internal Revenue Service. Instructions for Form 4562
4
Internal Revenue Service. Notice 2026-11 – Interim Guidance on Additional First Year Depreciation Deduction Under Section 168(k)
5
Internal Revenue Service. Publication 463 (2025), Travel, Gift, and Car Expenses
6
Internal Revenue Service. IRS Sets 2026 Business Standard Mileage Rate at 72.5 Cents Per Mile
7
Office of the Law Revision Counsel. 26 U.S. Code 280F – Limitation on Depreciation for Luxury Automobiles; Limitation Where Certain Property Used for Personal Purposes
8
Internal Revenue Service. Instructions for Form 4797
9
Office of the Law Revision Counsel. 26 USC 6662 – Imposition of Accuracy-Related Penalty on Underpayments