Section 179 and changes in business use percentage of vehicle

[Kris-S]

My husband just started a sole proprietorship business out of or home in Aug of 2016.  He purchased a new pick up truck that is eligible for Section 179.  Although we have another vehicle for personal use, he does use his truck for personal use sometimes.  The truck was purchased in Oct 2016 at which time he took several long mileage trips to pick up materials.  Based on actual mileage in 2016 the business use percent of his truck is 91%.  However, in future years we expect the business use percentage to be more like 75%.  If we take Section 179 based on 91% for 2016, what will happen if our actual business use drops to 75% in future years?  

[MichaelDC · Accepted solution]

As long as your business usage remains over 50%, there will be no adverse effect in future years. If it does, you may have to pay back some of the excess section 179 (depreciation).

It depends how much 179 you take in the first year and how many years til usage drops below 50%.

More than likely your total depreciation this year will be limited to the point where it won't cause future problems.