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Luxury Passenger Car Depreciation Caps

The 2019 limit annual depreciation deductions for luxury car depreciation caps for a passenger cars, SUV’s, trucks, and vans. 

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The 2019 limit annual depreciation deductions for luxury car depreciation caps for a passenger cars, SUV’s, trucks, and vans. 

The luxury car depreciation caps for a passenger car placed in service in 2019 limit annual depreciation deductions to: 

  • $10,100 for the first year without bonus depreciation 
  • $18,100 for the first year with bonus depreciation 
  • $16,100 for the second year 
  • $9,700 for the third year 
  • $5,760 for the fourth through sixth year 
  • The first-year cap for a passenger car acquired before September 28, 2017 and placed in service in 2019 is $14,900 if bonus depreciation is claimed 

Caps for SUVs, Trucks and Vans 

The depreciation caps for SUVs, trucks. and vans placed in service in 2019 limit annual depreciation deductions to: 

  • $10,100 for the first year without bonus depreciation 
  • $18,100 for the first year with bonus depreciation 
  • $16,100 for the second year 
  • $9,700 for the third year 
  • $5,760 for the fourth through sixth year 
  • The first-year cap for an SUV, truck, or van acquired before September 28, 2017, and placed in service in 2019 is $14,900 if bonus depreciation is claimed 

Excess Depreciation on Luxury Vehicles 

If depreciation exceeds the annual cap, the excess depreciation is deducted beginning in the year after the vehicle’s regular depreciation period ends. The annual cap for this excess depreciation is: 

  • $5,760 for passenger cars 
  • $5,760 for SUVS, trucks and vans 

Lease Inclusion Amounts 

If a vehicle is first leased in 2019, a taxpayer must add a lease inclusion amount to gross income in each year of the lease if its fair market value at the time of the lease is more than: 

  • $50,000 for passenger cars 
  • $50,000 for SUVS, trucks and vans 

The 2019 lease inclusion tables provide the lease inclusion amounts for each year of the lease. 

The lease inclusion amount results in a permanent reduction in the taxpayer’s deduction for the lease payments. 

Exempt Vehicles 

The depreciation caps and lease inclusion amounts do not apply to: 

  • Cars with an unloaded gross vehicle weight of more than 6,000 pounds; or 
  • SUVs, trucks and vans with a gross vehicle weight rating (GVWR) of more than 6,000 pounds 

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