Business Vehicle (5-Year MACRS) Depreciation Calculator
IRS MACRS depreciation calculator for business vehicles including cars, light trucks, and SUVs. 5-year recovery period with luxury auto limits.
Year 1 Deduction
$20,000
Recovery Period
5 years
Total Depreciation
$100,000
Method
DB/SL
Year
Rate
Deduction
Cumulative
1
20.00%
$20,000
$20,000
2
32.00%
$32,000
$52,000
3
19.20%
$19,200
$71,200
4
11.52%
$11,520
$82,720
5
11.52%
$11,520
$94,240
6
5.76%
$5,760
$100,000
IRS Classification
IRS Asset Class: GDS 5-year (MACRS Asset Class 00.22)
Section 179: EligibleBonus Depreciation: Eligible
Key Tax Facts
Passenger automobiles subject to annual luxury auto depreciation limits
Vehicles over 6,000 lbs GVWR (SUVs, trucks) subject to Section 179 $28,900 limit (2023)
Business-use percentage applies — only business portion is deductible
Listed property rules require adequate records of business use
Heavy SUVs over 6,000 lbs GVWR not subject to luxury auto caps
What This Covers
Cars used for business
Light trucks and vans
SUVs over 6,000 lbs GVWR
Pickup trucks
Common Questions
Business cars are 5-year MACRS property. However, passenger automobiles are subject to annual luxury auto depreciation limits set by the IRS each year. For 2023, the Year 1 limit is $12,200 ($20,200 with bonus depreciation). Only the business-use percentage of the vehicle is deductible.
Vehicles over 6,000 lbs GVWR (trucks, heavy SUVs) are not subject to luxury auto caps. However, SUVs over 6,000 lbs are limited to $28,900 in Section 179 expensing. Pickup trucks with a cargo bed of at least 6 feet are not subject to this SUV limit.
Only the business-use percentage is deductible. If you drive 15,000 miles total and 10,000 are for business, your business-use percentage is 66.7%. You may only depreciate 66.7% of the vehicle's cost. You must maintain a mileage log to substantiate business use.
The standard mileage rate (67 cents/mile for 2024) is simpler and requires less recordkeeping. Actual expenses (including depreciation) may be higher for expensive vehicles or those driven few miles. You must choose the method in the first year — switching from standard mileage to actual expenses later is restricted.
Tax disclaimer: This calculator provides estimates based on standard IRS MACRS rules from Publication 946. Your actual depreciation deduction may differ based on business-use percentage, the mid-quarter convention, state tax conformity, bonus depreciation phase-outs, and other factors specific to your situation. Always consult a licensed CPA or tax professional before making tax decisions.