Luxury auto limitations


Question: Tracy acquires an automobile (MARCS 5 year recovery) on March 1, 2009. He uses the automobile 70% of the time in his business and 30% of the time for personal use. The automobile costs $36,000, and no amounts are expensed under Sec. 179 or bonus depreciation.

Q1. What is depreciation for 2009-2011 and any subsequent years?

Q2. How would your answer to Part A change if the vehicle were a SUV with a gross vehicle weight rated (GVWR) of over 6,000 pounds and Tracy elected to expense the SUV under Sec. 179?

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Accounting Basics: Luxury auto limitations
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