Let’s start with a simple question:
Do you need more tax deductions for 2025?
If your answer is yes, keep reading.
Next question:
Do you need a replacement business vehicle?
If you also answered yes, here’s the good news:
You can solve both problems at the same time if you place your new vehicle in service on or before December 31, 2025.
And here’s the part many business owners forget:
To officially meet the IRS’s “placed in service” requirement, you need to drive the vehicle at least one business mile before the year ends.
Owning it isn’t enough—you need to use it.
Once that’s done, you unlock some of the biggest vehicle-related deductions available.
Let’s break them down.
Buy a New or Used SUV, Crossover, or Van (GVWR 6,001 lbs or more)
If you purchase and place in service a new or used SUV or crossover that the manufacturer classifies as a truck and it weighs 6,001 pounds or more (GVWR)—you get access to four major tax benefits:
- 100% bonus depreciation (unless you opt out)
- Section 179 expensing up to $31,300
- Five-year MACRS depreciation
- No luxury auto limits on your write-offs
Example:
You buy a used SUV for $50,000 and use it 90% for business.
Your deductible business amount becomes $45,000 and yes, you can write off the entire amount in 2025.
This is one of the fastest, cleanest ways to significantly lower your taxable income.
Buy A New or Used Pickup Truck
A qualifying pickup truck placed in service by December 31, 2025 also unlocks huge deductions:
- Up to 100% bonus depreciation
- Section 179 up to $2,500,000
- MACRS five-year depreciation
- No luxury auto limits
To qualify for full Section 179 expensing, your pickup must:
- Have a GVWR over 6,000 pounds, and
- Have a cargo bed at least 6 feet long that isn’t easily accessible from the cab
Example:
You purchase a pickup truck for $55,000 and use it 91% for business.
Your business deduction becomes $50,050 and you can write off the entire amount using Section 179 or bonus depreciation.
Short-bed trucks:
If the truck meets the GVWR requirement but has a bed shorter than 6 feet, the IRS treats it as an SUV.
That’s not a downside, you still get 100% bonus depreciation on the business-use percentage.
If you’ve been considering replacing your business vehicle, this might be the perfect year to do it.
Not only do you upgrade your business ride, you also unlock some of the most powerful deductions available to small business owners.
The key is simple:
Buy it. Place it in service. Drive one business mile. Do it before December 31, 2025.
If you want help calculating your exact deductions or deciding which vehicle gives you the best tax advantage, Basc Expertise is here to guide you.