Look no further than McKenna BMW, a renowned dealership with a wide range of BMW models. Learn more on how BMW vehicles, including some of their models available at McKenna BMW, can help you leverage the Section 179 tax deduction for business vehicles, which has undergone significant changes this year.
As a business owner, you’re always on the lookout for ways to enhance your company’s operations while optimizing your tax strategy. In 2024, the Section 179 tax deduction offers a great opportunity to upgrade your business vehicles and reduce your tax liability. McKenna BMW, with its reputation for quality and innovation, presents an attractive choice. Learn more below on which BMW vehicles apply and how we can help you capitalize on the Section 179 deduction
Tax Code 179 allows small business owners who purchase a vehicle over 6,000 pounds GVWR (gross vehicle weight rating) and are more than 50% business-use to write off a percentage of the depreciation of the vehicle during the year in which it is purchased or leased. As the new year approaches, this is the optimal time to register a new vehicle under your business’s name and to ensure you’re maximizing your business’s tax deductions. Contact a tax advisor to learn how much you can expect to write off based on your business and vehicle of choice.
Tax Code 179, the special deduction to write off equipment in the year purchased, was extended permanently in 2015 legislation. This has been further liberalized by the Tax Cuts and Jobs Act (TCJA) that Congress enacted in December 2017.
Beginning in 2018, this special deduction allows businesses to write off up to $1 million worth of depreciable assets in the year that they are purchased. This can include new machinery, heavy equipment, furniture and fixtures, and certain vehicles, mainly SUVs and pickup trucks. BMW models that qualify are the BMW X5, X6, X7, XM, i7 and iX. There are certain limitations to the rule in addition to the $1 million cap. For example, if you purchase more than $2,500,000 in assets for the year, then you will have this deduction phased out. Also, you must have a positive income and not a net loss for the year. However, if you meet these guidelines, then it can be a great idea to move those vehicle purchases you are planning for next year forward to 2024 to take advantage of last-minute tax savings. You must purchase the vehicle between January 1, 2024 and December 31, 2024, to get the write-off on your 2024 taxes.
