SECTION 179 TAX BENEFITS

Maximize Your Business Potential with Section 179 Deductions

Unlock greater financial flexibility for your business with the Section 179 deduction. A part of the IRS tax code, Section 179 allows businesses to deduct the full purchase price of qualifying equipment bought or financed during the tax year. This significant tax incentive is designed to encourage businesses to invest in themselves by purchasing the equipment they need to grow. Section 179 can be extremely profitable for your business, allowing you to invest in equipment, vehicles, and software while retaining more of your tax dollars.

Section 179 Tax Deduction for Ford Commercial Vehicles - 2025 Guide

What Is Section 179?

Most people think the Section 179 deduction is some mysterious or complicated tax code. It really isn't, as you will see below.

Essentially, Section 179 of the IRS tax code allows businesses to deduct the full purchase price of qualifying equipment and/or software purchased or financed during the tax year. That means that if you buy (or lease) a piece of qualifying equipment, you can deduct the FULL PURCHASE PRICE from your gross income. It's an incentive created by the U.S. government to encourage businesses to buy equipment and invest in themselves.

Several years ago, Section 179 was often referred to as the "SUV Tax Loophole" or the "Hummer Deduction" because many businesses have used this tax code to write-off the purchase of qualifying vehicles at the time (like SUV's and Hummers). But that particular benefit of Section 179 has been severely reduced in recent years (see 'Vehicles & Section 179' for current limits on business vehicles.)

However, despite the SUV deduction lessened, Section 179 is more beneficial to small businesses than ever. Today, Section 179 is one of the few government incentives available to small businesses, and has been included in many of the recent Stimulus Acts and Congressional Tax Bills. Although large businesses also benefit from Section 179 or Bonus Depreciation, the original target of this legislation was much needed tax relief for small businesses - and millions of small businesses are actually taking action and getting real benefits.

Quick Facts for 2025:

  • Deduction Cap: Up to $1,250,000
  • Spending Cap: Begins phase-out after $3,130,000
  • Bonus Depreciation: 100% on new and used vehicles
  • Eligibility: Vehicle must be used 50% or more for business
  • Deadline: Must be purchased and placed in service by December 31, 2025 [tworiversford.com]

 Eligible Ford Models

Ford offers a wide range of vehicles that qualify for Section 179 deductions. Eligibility is based on Gross Vehicle Weight Rating (GVWR) and business usage.

Heavy-Duty Vehicles (GVWR > 6,000 lbs):

  • Ford F-150
  • Ford Super Duty® (F-250, F-350, F-450)
  • Ford Transit
  • Ford Transit Connect
  • Ford Expedition
  • Ford Explorer

These models may qualify for up to $31,300 in Section 179 deductions, plus 100% bonus depreciation. [sarchioneford.com]

Note: Used vehicles qualify if they are "new to you" and meet IRS business-use criteria. [crestcapital.com]

Tax Savings Example

Example:

  • Purchase a Ford F-250 for $70,000
  • Deduct up to $31,300 under Section 179
  • Apply 100% bonus depreciation on remaining value
  • Total deduction: $70,000 in year one [taxfully.com]

Use the https://www.section179.org/section_179_vehicle_deductions/ to estimate your savings.

How to Claim

To take advantage of Section 179:

  1. File IRS Form 4562
  2. Maintain records of purchase and business use
  3. Consult your tax advisor for eligibility and documentation

Disclaimer: This information is for general guidance only and does not constitute tax or legal advice. Please consult a qualified tax professional to determine your eligibility. [kbb.com]

Limits of Section 179

Section 179 does come with limits - there are caps to the total amount written off ($1,220,000 for 2024 ), and limits to the total amount of the equipment purchased ($3,050,000 in 2024 ). The deduction begins to phase out on a dollar-for-dollar basis after this limit is reached by a given business (thus, the entire deduction goes away once $4,270,000 in purchases is reached), so this makes it a true small and medium-sized business deduction.

Who Qualifies for Section 179?

All businesses that purchase, finance, and/or lease new or used business equipment during tax year 2024 should qualify for the Section 179 Deduction (assuming they spend less than $4,270,000).

Most tangible goods used by American businesses, including "off-the-shelf" software and business-use vehicles (restrictions apply) qualify for the Section 179 Deduction.

For basic guidelines on what property is covered under the Section 179 tax code, please refer to list of Section 179 Qualifying Equipment. Also, to qualify for the Section 179 Deduction, the equipment and/or software purchased or financed must be placed into service between January 1, 2024 and December 31, 2024.

For 2024, $1,220,000 of assets can be expensed; that amount phases out dollar for dollar when $3,050,000 of qualified assets are placed in service.

What's the difference between Section 179 and Bonus Depreciation?

Bonus depreciation is offered some years, and some years it isn't. Right now in 2024, it's being offered at 60%.

The most important difference is both new and used equipment qualify for the Section 179 Deduction (as long as the used equipment is "new to you"), while Bonus Depreciation has only covered new equipment only until the most recent tax law passed. In a switch from recent years, the bonus depreciation now includes used equipment.

Bonus Depreciation is useful to very large businesses spending more than the Section 179 Spending Cap (currently $3,050,000) on new capital equipment. Also, businesses with a net loss are still qualified to deduct some of the cost of new equipment and carry-forward the loss.

When applying these provisions, Section 179 is generally taken first, followed by Bonus Depreciation - unless the business had no taxable profit, because the unprofitable business is allowed to carry the loss forward to future years.

Section 179's "More Than 50 Percent Business-Use" Requirement

The equipment, vehicle(s), and/or software must be used for business purposes more than 50% of the time to qualify for the Section 179 Deduction. Simply multiply the cost of the equipment, vehicle(s), and/or software by the percentage of business-use to arrive at the monetary amount eligible for Section 179.

Please see https://www.section179.org/section_179_deduction/ for more information.

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