Section 179 Calculator

Calculate how much you can save on taxes when purchasing fleet vehicles. Compare Section 179, Bonus Depreciation, and MACRS side by side.

Fleet Vehicles

Purchase Price ($)

Business Use (%)

Deduction Method

Section 179 (Full Write-Off Year 1)

Deduct up to $1,220,000 in the year of purchase. Must have enough business income to offset.

Bonus Depreciation (60% Year 1)

Deduct 60% in Year 1, remaining via MACRS over 5 years. No income limit.

MACRS Only (5-Year Schedule)

Standard depreciation: 20%, 32%, 19.2%, 11.52%, 11.52%, 5.76% over 6 years.

Your Tax Situation

Annual Business Income ($)

Used to estimate your marginal tax rate

Filing Status

Your Tax Savings

Estimated Year 1 Tax Savings

$17,158

on $45,000 in vehicle purchases

Year 1 Deduction

$45,000

Total Depreciation

$45,000

Vehicles

Effective Cost

$27,842

Per Vehicle

Vehicle 1

$45,000

Year 1 deduction

Section 179 lets you deduct the full purchase price in Year 1. Your business income must be at least equal to the deduction.

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Important

This calculator provides estimates for educational purposes only. Tax laws are complex and your situation is unique. Always consult a qualified CPA or tax professional before making tax decisions.

Frequently Asked Questions

What is the Section 179 deduction?

Section 179 of the IRS tax code allows businesses to deduct the full purchase price of qualifying equipment (including vehicles) in the year of purchase, rather than depreciating over multiple years. For 2026, the maximum deduction is projected at $1,220,000.

Do rental fleet vehicles qualify for Section 179?

Yes — vehicles used for rental fleet operations qualify for Section 179 as long as they're used more than 50% for business purposes. The key requirement is that the business must have enough taxable income to offset the deduction.

What's the difference between Section 179 and Bonus Depreciation?

Section 179 requires sufficient business income to offset the deduction (no loss allowed). Bonus Depreciation has no income limit and can create a net operating loss. However, Bonus Depreciation is stepping down — it's 60% in 2026, down from 100% in 2022.

Can I use Section 179 for used vehicles?

Yes! Since the Tax Cuts and Jobs Act of 2017, both new and used vehicles qualify for Section 179. The vehicle just needs to be new-to-you (first time in service for your business).

What vehicles qualify for the full Section 179 deduction?

Vehicles over 6,000 lbs GVWR (like full-size SUVs, trucks, and vans) qualify for the full Section 179 deduction. Passenger vehicles under 6,000 lbs have a lower cap (around $20,400 for 2026). This is why many fleet operators prefer SUVs and trucks.