SECTION 179 TAX SAVINGS GUIDE

Section 179 Tax Savings

Many Business owners may be eligible to write-off up to 100% of the purchase cost on their next new Ford purchase.

Take advantage of these tax deductions for your small business when you purchase a new Ford vehicle by December 31st!

TAX BENEFIT EXAMPLES FOR QUALIFYING BUSINESSES

Important Information

Hurry! You must act by December 31, 2020 to get your deduction for the 2020 tax year

Q: What is IRS Section 179? How can it help my bottom line?

A: 179 is the current IRS tax code that allows you to buy qualifying Ford vehicles and deduct up to the full purchase price (including any amount financed) from your gross taxable income if purchased before December 31, 2020. That means that if you buy a piece of qualifying equipment and products, you may be able to write off up to the FULL PURCHASE PRICE from your gross taxable income this year!

Q: Does the date of my purchase have an impact on the Section 179 deduction?

A: Yes, to qualify for the Section 179 tax deduction for the 2020 tax year, your Ford vehicle must be purchased or leased and placed into service by December 31, 2020.

Q: Which vehicles qualify for the greatest IRS tax savings?

A: Trucks with a GVWR greater than 6,000 lbs. and a bed length of at least six feet (i.e., Ford F-150/F-250/F-350) qualify for the maximum first-year depreciation deduction of up to the FULL PURCHASE PRICE. SUVs, including trucks, with a bed length of less than six feet and a GVWR greater than 6,000 lbs. (i.e., Ford F-150 SuperCrew 5 1/2 ft. bed, Explorer, Expedition) qualify for a maximum first-year depreciation deduction of up to the first $25,000 of the full purchase price plus 60% depreciation of any remaining balance.

Q: What about smaller trucks/Vans/SUVs?

A: Vehicles of less than 6,000 lbs. GVWR (built on a truck chassis), such as the Transit Connect, may still qualify under current bonus depreciation for up to $11,560 per vehicle in the first year. Passenger automobiles under 6,000 lbs. GVWR also may qualify for up to $11,160 in depreciation.

NOTE: The information supplied here is provided by your local Ford Dealer as a public service to its customers. It should not be construed as tax advice or as a promise of potential tax savings or reduced tax liability. Individual tax situations may vary. Federal rules and tax guidelines are subject to change. For more information about the Section 179 expense write-off or other business vehicle expense write-offs, you should consult your tax advisor for complete rules applicable to your transaction and visit the Internal Revenue Website at www.irs.gov.

1. This analysis applies only to vehicles placed in service in the United States after December 31, 2015 and by December 31, 2020 with no written binding contract for acquisition in effect before January 1, 2020. The aggregate deduction of $500,000 under Internal Revenue Code Section 179 is most beneficial to small businesses that place in service less than $2,000,000 of “Section 179 property” during the year (vehicles and other business property)
2. IRC Section 280F(d)(7(B) requires that the limitation under IRC Section 280F(a)(1) be adjusted annually, based on the CPI automobile component for October of the preceding year. The IRS officially announced the Section 280F depreciation limits in Revenue Procedure 2017-23. The passenger automobile imitation is $11,160, the trucks/vans under 6,000 lbs. limitation is $11,560. SUV’s over 6,000 pounds GVWR are limited to a deduction of $25,000 under Section 179(b)(5) with the remaining basis in the vehicle depreciated under normal MACRS methods. The expensing restrictions under Section 280F do not apply to vehicles that are considered to be “qualified non-personal use vehicles” (QNUVs). A QNUV is generally a vehicle that, by virtue of its nature or design, is not likely to be used more than a de minimis amount for personal purposes. For more information, see Income Tax Reg., Sec. 1.280F-6(c)(3)(iii), Income Tax Reg. Sec. 1.274-5T(k), and Revenue Ruling 86-97, and contact your tax advisor for details. Consult your tax advisor as to the proper tax treatment of all business-vehicle purchases
3. All prices exclude taxes, title and registration and document fees. Not all buyers will qualify for all offers. Above total savings are examples of specific vehicles; total savings varies by vehicle. (Individual Vehicle Incentives and Offers go here) Available at participating dealers only. For all offers, take new retail delivery from dealer stock by 12/31/2020. See dealer qualifications and complete details. All incentives were correct at the time of printing and are subject to change at any time. Models shown may not represent actual vehicle description listed, and therefore may include additional features and/or accessories.

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BIG VALUE FOR SMALL BUSINESS.

EARN 2020 TAX DEDUCTIONS UP TO A TOTAL OF $510,000.¹

We take pride in giving you the best value on new Chevrolet vehicles your business depends on. With the 2020 tax incentives, you could be eligible for up to a total of $510,000 in tax deductions when you purchase qualifying Chevrolet vehicles for your business before 12/31/2020. You can stack select business Choice offers and other incentives to get an even bigger haul.

1. Each individual’s tax situation is unique; therefore, please consult your tax professional to con rm vehicle depreciation deduction and tax bene ts. For more details, visit irs.gov. 2. For vehicles that qualify as passenger automobiles under the Internal Revenue Code, there is an $11,560 per-vehicle depreciation deduction cap for certain SUVs, trucks and vans placed in service during 2020. 3. For vehicles that qualify as sport utility vehicles, including certain trucks and vans, under the Internal Revenue Code, the maximum amount that may be expensed is $25,000 of the total purchase price. The $25,000 expense cap contributes to the $510,000 dollar limit and $2,030,000 investment limit under Section 179. 4. The tax incentives are available for depreciable tangible property that is acquired by purchase for use in the active conduct of a trade or business. Additional limitation based on purchases. For the 2020 tax year, the aggregate deduction of $510,000 under Internal Revenue Code Section 179 is most bene cial to small businesses that place in service no more than $2,030,000 of “Section 179 property” during the year. For every dollar spent on Section 179 property in excess of the overall limit of $2,030,000, the $510,000 expense-tax deduction decreases by a dollar. Certain vehicles, models and restrictions apply. Consult your tax professional for details. ©2020 General Motors LLC.

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ProMaster City passenger van may be eligible for up to $11,560 in total deductions in year 1. The listed property expensing restrictions provided in Section 280F do not apply to a vehicle that is considered to be a qualified nonpersonal use vehicle. A qualified nonpersonal use vehicle is by virtue of its nature or design not likely to be used more than a de minimis amount for personal purposes. For more information, see Income Tax Regulation Section 1.280F-6(c)(3)(iii), Income Tax Regulation Section 1.274-5(k)(7), Publication 946 - How to Depreciate Property and consult your tax advisor as to the proper tax treatment of all business-vehicle purchases in 2020. This is not tax advice. Ram is a registered trademark of FCA US LLC.