The 6,000 lb. Gross Vehicle Weight Tax Deduction

In a previous blog post, we discussed how Section 179 of the tax code allows business owners to accelerate deductions for tangible business assets. Today we’ll explore one strategy for further maximizing tax efficiency by increasing the weight of vehicles used for business.

Under the IRS’s depreciation provisions, different rules apply between smaller vehicles such as sedans versus larger vehicles such as trucks and vans. Large vehicles, defined as vehicles that weigh between 6,000 and 14,000 lbs., are eligible for higher tax deductions in the first year that the vehicle is placed into service.

But even S-corporation owners who do not need a heavy-duty truck for their business can benefit from this deduction. If you drive a sport utility vehicle (SUV) that weighs less than the 6,000 lbs. threshold, you may be able to install a tow hitch to increase the weight of the vehicle sufficiently. Most dealers have this option available at purchase, and typically the few hundred dollars charged to install it is a much smaller investment than the thousands of dollars save by reducing your taxes. In 2022, SUVs with loaded vehicle weights over 6,000 lbs. (but less than 14,000 lbs.) can be 100% deducted using bonus depreciation.

The vehicle must also be used primarily (at least 50%) for qualified business use. It can be either new or used. However, the vehicle may not be used for transporting people or property for hire.

Finally, to claim the deduction for 2022, the vehicle must be placed into service by December 21, 2022.

To substantiate the deduction for heavy vehicles, we recommend that Arizona taxpayers update their registration with the Department of Motor Vehicles (DMV). According to Arizona statute:

“A person may increase the declared gross weight of a vehicle or vehicle combination after the original registration and during the registration year by reregistration of the vehicle or vehicle combination. The person shall pay a fee in addition to the gross weight fee prescribed in this article based on the difference between the fee due at the time of reregistration for the weight class in which the vehicle or vehicle combination was originally registered and the fee due at the time of reregistration for the increased weight class.”

That means that the cost of proving that your vehicle meets the IRS weight requirements should be only a small fee.

As a reminder, make sure that you are capturing all the expenses related to your business vehicle including the following:

  • Registration fees and taxes
  • Maintenance and repairs
  • Auto insurance
  • Fuel

Upgrades to increase the weight of an SUV used for business can have huge payoffs at tax time. If you have any questions about this or other business deductions, call our office at 520-353-4502.

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