179 and bonus depreciation for semi trucks

[WeeYum]

I just bought a semi truck this year and I am doing taxes. I am not quite sure whether to take the 179 deduction and bonus depreciation. Also, I need to to both the trailer and the rig. please help.

[Cynthiad66]

While the basic concept for both methods is similar, there are differences between the two methods. The good news is that you can take advantage of both (or one or neither) if you so desire.

The benefits are that you get a huge write off this year.  However, is that the best time for your business unless this is not a new business but rather new equipment.

As a business, you need to consider the fact that by electing to take accelerated depreciation, you are in essence relieving your current tax burden by giving up future deprecation in exchange.

Section 179 vs Bonus Depreciation is a must read for you.

[WeeYum]

Thank you very much. I just started my business and purchased the truck in October 2021.

[PatriciaV]

Unfortunately, Section 179 and Special (Bonus) Depreciation are available only in the year that you first used the truck for your business, and in most cases you must be the first person to own the equipment. If you purchased and began using the truck in 2021, you should have claimed the accelerated depreciation on your 2021 tax return. You do have the option to amend your 2021 return and claim this depreciation, which could affect your taxes a great deal.

However, if you actually purchased a new truck in 2022 and began using it for your business in 2022, you have the options that Cynthiad66 mentioned above. This could be a significant decision for your business, so you may wish to consult with a local tax or business expert before you decide.