Question

On July 10, 2018, Ariff places in service a new sports utility vehicle that cost $80,000 and weighed 6,300 pounds. The SUV is used 60% for business. Determine Ariff’s maximum deduction for 2018, assuming Ariff’s § 179 business income is $110,000. Ariff does not take additional first-year depreciation but elects Section 179. How would your answer change if Ariff decided to use the standard mileage rate method of recording automobile expenses (as opposed to the actual method)? If Ariff originally chooses the actual method and elects a Section 179 expense deduction, can he switch to the standard mileage method

Answer 1

section 179 Equipment, vehicles, and/or software purchased under Section 179 must be used for business purposes more than 50% of the time to qualify for the deduction since the vehicle is used more than 50 % in business and also gross vehicle weight rating between 6,000 pounds and 14,000 pounds to Ariff can claim $ 48000 ( 60% of $ 80,000) for 2018. If Ariff decided to use the standard mileage rate method of recording automobile expenses then he is allwoed of 54.5 cents for every mile of business travel driven.. If Ariff originally chooses the actual method and elects a Section 179 expense deduction then he can not  switch to the standard mileage method