Does your vehicle qualify for automotive bonus depreciation? If you use a Ford vehicle for your business, you may be eligible to claim depreciation tax incentives on your vehicle as it ages. To learn more about automotive bonus depreciation and how it works, Folsom Lake Ford has the details.
What Is Automotive Bonus Depreciation?
Bonus depreciation is a tax deduction factored in on depreciable goods (including vehicles). Businesses can claim this on vehicles at purchase to receive a discount on the purchase price. This lowers your overall expenses, which can lead to savings on your corporate tax return.
Is My Vehicle Eligible?
In most cases, any vehicle you purchase for your business may be eligible for bonus depreciation. Essentially, it allows you to cover normal depreciation costs upfront to lower your overall taxable income and spending. You can claim the depreciation incentives on a Ford vehicle if it’s used primarily for official use.
These regulations typically only apply to purchased vehicles, however. If you lease a business vehicle, you likely won’t be able to claim this incentive.
How Much Can I Deduct?
Under the Tax Cuts and Jobs Act of 2017, businesses can deduct 100% of the depreciation value as bonus depreciation at purchase. Previously, the deductible depreciation rate was set at 50%. If you haven’t adjusted your estimated savings with the new terms, you’ll want to check to see if claiming bonus depreciation is worth it.
Learn About Bonus Depreciation at Folsom Lake Ford
Our finance team can help you determine what depreciation and tax incentives you can claim. Contact Folsom Lake Ford today to see if your vehicle is eligible for bonus depreciation.