Because 50% bonus depreciation is allowed only for new vehicles, the limits are different for new and used vehicles. Here’s a quick review.
For new business cars first placed in service this year, the first-year depreciation limit is $11,160; for used cars, it’s $3,160. After year one, the limits are the same for both new and used cars: $5,100 in year two, $3,050 in year three, and $1,875 in all following years.
The 2013 first-year depreciation limit for light trucks and vans is $11,360 for new vehicles and $3,360 for used vehicles. Limits for both new and used vehicles in year two are $5,400, in year three $3,250, and in each succeeding year $1,975.
For details relating to your 2013 business vehicle purchases, contact our office.