September 27, 2021
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Rekor Systems Announces Selection of Waycare Technologies by Louisiana Department of Transportation and Development for Pilot Program to Reduce State Traffic Congestion and Crashes
California homeless camp fire damages 2 bridges, disrupts public transportation
Austin finishes half of its bicycle network, expects to complete entire 400-mile system by 2025
The Top 10 Automotive Concepts that automotive enthusiasts will be itching to see on the road!
Oregon Transportation Commission, wary of I-5 Rose Quarter project’s growing price tag, grants conditional approval
Woman dies after being hit by car in North Windham Friday night
Silk-FAW Continues To Poach Italy’s Automotive Talent, As Lamborghini’s Katia Bassi Joins As Managing Director
Transportation Department cracks down on airlines withholding refunds for canceled flights
Bear gets trapped in car, destroys interior
Cycling apparel company adding full-service bike repair to visitor center
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Rekor Systems Announces Selection of Waycare Technologies by Louisiana Department of Transportation and Development for Pilot Program to Reduce State Traffic Congestion and Crashes California homeless camp fire damages 2 bridges, disrupts public transportation Austin finishes half of its bicycle network, expects to complete entire 400-mile system by 2025 The Top 10 Automotive Concepts that automotive enthusiasts will be itching to see on the road! Oregon Transportation Commission, wary of I-5 Rose Quarter project’s growing price tag, grants conditional approval Woman dies after being hit by car in North Windham Friday night Silk-FAW Continues To Poach Italy’s Automotive Talent, As Lamborghini’s Katia Bassi Joins As Managing Director Transportation Department cracks down on airlines withholding refunds for canceled flights Bear gets trapped in car, destroys interior Cycling apparel company adding full-service bike repair to visitor center

IRS updates car and truck depreciation limits

The IRS issued its annual inflation-adjusted update of depreciation limitations for passenger automobiles (including passenger vans and trucks) placed in service in 2021 (Rev. Proc. 2021-31). The revenue procedure similarly updates income inclusion amounts by lessees of passenger automobiles with respect to vehicles with lease terms beginning in 2021. These limits are updated annually for inflation according to the automobile component of the chained consumer price index for urban consumers.

For passenger automobiles to which bonus first-year depreciation deduction applies and that are acquired after Sept. 27, 2017, and placed in service during calendar year 2021, the depreciation limit under Sec. 280F(d)(7) is $18,200 for the first tax year (an increase of $100 from 2020); $16,400 for the second tax year (an increase of $300); $9,800 for the third tax year (an increase of $100); and $5,860 for each succeeding year (an increase of $100).

For passenger automobiles to which no bonus first-year depreciation applies, the depreciation limit under Sec. 280F(d)(7) is $10,200 for the first tax year; $16,400 for the second tax year; $9,800 for the third tax year; and $5,860 for each succeeding year.

Sec. 280F(c) limits deductions for the cost of leasing automobiles, expressed as an income inclusion amount. This limitation, calculated according to a formula and tables prescribed under Regs. Sec. 1.280F-7, is intended to be substantially equivalent to the depreciation limitation. Table 3 of Rev. Proc. 2021-31 provides income inclusion dollar amounts for lessees of passenger automobiles with a lease term beginning 2021, for each year of the lease, based on the automobile’s fair market value.

Paul Bonner (Paul.Bonner@aicpa-cima.com) is a JofA senior editor.