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🚘 Turning Your Personal Vehicle Into a Business Asset? Here’s What to Know About Depreciation 🚘

🚘 Turning Your Personal Vehicle Into a Business Asset? Here’s What to Know About Depreciation 🚘

When you convert a personal vehicle for business use, the IRS lets you start depreciating it and claim deductions. But here’s the catch:

Your depreciation basis is the lesser of:🔹 The fair market value on the date you start using it for business, OR🔹 Your adjusted basis (what you originally paid + improvements).

Example:Jim bought a car for $80,000. Today it’s worth $35,000. When he switches it to business use, Jim must use the $35,000 fair market value as his depreciation basis.

  • If you’re considering this move, plan carefully to maximize tax benefits.

Disclaimer: This content is provided for educational purposes only and is not legal, tax, accounting, or financial advice. Every situation is unique, so consult your own attorney, CPA, or financial advisor before making decisions based on this information.