5-year property · 200% declining balance, half-year
Includes: Passenger cars and taxis used in the business. Watch: Passenger cars also have yearly depreciation caps (section 280F), and a car used 50% or less for business must use straight-line ADS with no section 179 or bonus. Only the business share is depreciated.
Capped by the 2026 limits for cars of 6,000 lbs or less (Rev. Proc. 2026-15): $20,300 in year one instead of $38,000. What is held back is deducted in later years. Years 2 to 6 use the IRS safe harbor for 100% bonus (Rev. Proc. 2019-13).
| Line 12 · Section 179 expense | $0.00 |
|---|---|
| Line 14 · Special (bonus) depreciation, 100% | $20,300.00 |
| Line 19 · MACRS, 5-year property | $0.00 |
| Tax year | Rate | Depreciation | Accumulated | Basis left |
|---|---|---|---|---|
| 2026 | 20.000% | $0.00 | $20,300.00 | $17,700.00 |
| 2027 | 32.000% | $5,664.00 | $25,964.00 | $12,036.00 |
| 2028 | 19.200% | $3,398.40 | $29,362.40 | $8,637.60 |
| 2029 | 11.520% | $2,039.04 | $31,401.44 | $6,598.56 |
| 2030 | 11.520% | $2,039.04 | $33,440.48 | $4,559.52 |
| 2031 | 5.760% | $1,019.52 | $34,460.00 | $3,540.00 |
| 2032 | carried over | $3,540.00 | $38,000.00 | $0.00 |
Basis = cost × business use · each year = the lesser of the table amount (basis left after year one × table rate) and that year’s IRS limit × business use · what is left is carried over at the yearly limit
IRS Pub 946 tables · §179 and bonus per the One Big Beautiful Bill Act · car limits per §280F and the IRS yearly revenue procedure.
Placed in service March 2026, 100% business use, no section 179 or bonus.
| Tax year | Depreciation |
|---|---|
| 2026 | $7,600 |
| 2027 | $12,160 |
| 2028 | $7,296 |
| 2029 | $4,378 |
| 2030 | $4,378 |
| 2031 | $2,189 |
Source: Pub 946 Table B-1, asset class 00.22 Automobiles, Taxis (class life 3, GDS 5, ADS 5). IRS Publication 946.
Cars are 5-year property under MACRS, depreciated with 200% declining balance, half-year. Under the Alternative Depreciation System the period is also 5 years. Source: Pub 946 Table B-1, asset class 00.22 Automobiles, Taxis (class life 3, GDS 5, ADS 5).
For a car of 6,000 lbs gross vehicle weight or less placed in service in 2026: $20,300 in the first year with bonus depreciation ($12,300 without), $19,800 in the second, $11,900 in the third and $7,160 a year after that, Section 179 included (IRS Rev. Proc. 2026-15). Each limit is scaled by business use, and whatever they hold back is deducted in later years.
Not a car of 6,000 lbs or less: the yearly limits above apply even with Section 179 and 100% bonus. Vehicles over 6,000 lbs gross vehicle weight escape them; SUVs among them are limited to $32,000 of Section 179 in 2026, and need more than 50% business use like any vehicle.
With no section 179 or bonus, placed in service in March 2026: $7,600 in 2026, $12,160 in 2027, $7,296 in 2028, $4,378 in 2029, and so on: each under the yearly limits, so nothing is held back.
Passenger cars also have yearly depreciation caps (section 280F), and a car used 50% or less for business must use straight-line ADS with no section 179 or bonus. Only the business share is depreciated.