Vehicle depreciation section 179

[Thiag Sivalingam]

Hi Tax experts and experienced investors,

Do I need to own my rental properties under a business to claim the new car depreciation (section 179), or can I have the properties and the car in my name, and still claim the depreciation?

Thank you

[Jack Faysash]

Are you planning on using the car solely for business purposes, or also for personal use? To even consider taking section 179 on the vehicle, it must be used at least 50% for business purposes. If you use the vehicle more than 50% in the first year of service, but use it less than 50% in a following year, you are required to recapture any excess depreciation.

If you plan to use the vehicle for more than 50% business use, you would not need a separate business entity to claim the deduction, you can claim it on schedule C. I highly suggest meeting with a tax professional to make sure you figure the correct amount to deduct if you plan to go this route.