Does Jeep Gladiator Qualify For Section 179? (Beginners Guide)
Buying a new vehicle like the Jeep Gladiator can eat deep into your finances if you aren’t prepared for it.
However, as a tax-paying business owner, you may be considering the financial options you have before making the purchase.
And if you’re interested in using the benefits of a full Section 179 deduction, you may wonder whether it covers purchasing a Jeep Gladiator. So, does Jeep Gladiator qualify for Section179?
Yes, purchasing the Jeep Gladiator qualifies for the benefits of Section 179. The gross cost of the vehicle can be deducted from your federal income tax as it is eligible for this benefit. However, you must have at least the price of your vehicle as your net income before applying for this benefit.
Does A Jeep Gladiator Qualify For Section 179?
Yes, a Jeep Gladiator qualifies for Section 179. Jeep has a select range of vehicles covered by this tax benefit, and the Gladiator is one of them.
So, with sufficient net income, you should get this benefit without hassle. How this works is that the cost of purchasing the vehicle is deducted from your net taxable income.
So, with that in mind, your net income per year determines how much you can deduct.
If your net income is less than the total cost of the vehicle, you can carry over your deduction into the next year.
However, you can’t spread deductions from Section 179 over long periods.
So, if the asset you want to purchase is really expensive, you should consider using bonus depreciation deductions.
What Is Section 179?
Section 179 is a section of the US Internal Revenue Code that provides a taxpayer the benefit of deducting the expense of purchasing a tangible and depreciable property from their federal income taxes.
For businesses, properties such as vehicles like the Jeep Gladiator are eligible for this deduction. However, there are limitations regarding the kind of vehicle the law applies to.
For example, only vehicles that weigh between 6,000 to 14,000 pounds in total are eligible for a deduction from income tax.
Furthermore, the property must be critically important for your business. If not, it won’t come under consideration for the tax deduction.
In this case, the property, or vehicle, must be used by your business for more than 50 percent of the year.
For some vehicles, a price ceiling, most times $25,000, is usually placed on the total deductible amount. Funds usually cover any costs exceeding the maximum cost from other sources.
In addition, the maximum deductions from income tax a taxpayer can obtain must not exceed $1.04 million for a tax year.
Which Trucks Qualify For The Section 179 Deduction?
A couple of trucks qualify for the Internal Revenue Code’s Section 179 deduction.
These include pickup trucks that exceed 6000 pounds in gross weight, trucks that use more than 50 percent of the time for business purposes, and cargo trucks that do not have passenger seats.
Most Jeep brand vehicles qualify for it.
So, many trucks fall into these categories. And from Jeep alone, below are some examples:
#1. Jeep Gladiator:
The Jeep Gladiator vehicles qualify for the Section 179 deduction because they weigh over 6000 pounds and are excellent for transporting cargo.
The vehicles qualify for a full Section 270 deduction under this brand, including the
#2. Rubicon:
The Gladiator Rubicon has a few features that distinguish it from the other Jeep Gladiators. For one, it’s a bit pricier; thus, it will eat more into your income tax.
Furthermore, it comes with special branding and different wheels from the other Gladiator models.
#3. Mojave:
Although the Mojave is less pricey than the Rubicon, hence requiring a lower tax deduction, it is more rugged. It’s perfectly capable of trodding desert terrain and has deeply tractioned tires.
#4. Jeep Gladiators with a V6 Engine:
All Jeep Gladiators with a V6 engine qualify for a full section deduction.
#5. Jeep Wrangler:
The Jeep Wrangler vehicles are also eligible for the Revenue Code Section 179 deduction, provided that they are used for business purposes only.
Although the bed of the Wrangler models isn’t as long as those of the Gladiators, they can still carry cargo and serve business purposes.
Furthermore, it’s a Jeep brand vehicle that comes with a V6 engine, and some even have to tow capacities, giving them the green light for tax income deductions.
#6. The Grand Cherokee 4×e:
While the Grand Cherokee 4×e is an SUV and not a truck, it’s still eligible for a Section 179 deduction. It’s an electric hybrid used in business settings for personnel transport.
Why Would You Take Section 179 Instead of Bonus Depreciation?
I would take a full Section 179 deduction over the bonus depreciation because it allows a more flexible timeline for deducting tax income on property expenses.
Furthermore, Section 179 covers refurbishing or upgrades on property like real estate.
While Bonus depreciation does have its benefits, I’d rather go with Section 179 over it for a couple of reasons.
#1. Flexibility:
With Section 179, you have more control over when you can apply your Section tax deduction.
You can choose which year’s tax income you deduct on a particular purchase and which years you choose to save.
Furthermore, you can choose which purchases to use Section 179’s deduction on, unlike bonus depreciation which covers all your expenses equally.
For instance, if you want to let your tax deduction cover half of the cost of a Jeep Gladiator and the entire cost of another property, Section 179 allows for this option.
However, with bonus depreciation, you don’t have this much flexibility. Will Jeep Gladiator Wheels Fit On A JK? (Let’s See).
#2. The cost of the property doesn’t have to be depreciated:
With the Revenue Code’s Section 179, it’s easier to pay for the cost of a particular property at once without having to depreciate the cost of the vehicle.
While you can now use bonus depreciation to cover 100 percent of the cost of the property, with Section 179, the cost spreads over a shorter period.
While these benefits are quite good, there are still benefits of using bonus depreciation.
Firstly, there is no annual limit on deductions made via bonus depreciation.
While purchases covered by Section 179 deductions have a ceiling of your net income up to $1.04 million, bonus depreciation does not impose an annual limit on purchases.
In the same vein, your net income per year doesn’t limit deductions from bonus depreciation. They can spread out over a relatively long period, unlike Section 179 tax deductions.
The sad part of going with a bonus depreciation is that you can’t select which properties you use it on in the active period.
However, if it’s what works best for you, you should go with it. Can A Jeep Gladiator Pull A Horse Trailer?
Conclusion
The Jeep Gladiator is eligible for purchases using a Section 279 deduction. However, it must be for business purposes over 50 percent of the time.
When considering whether you should go with a Section 279 deduction or a bonus depreciation on your Jeep Gladiator purchase, it’s best to check out the benefits.
On the one hand, you have more flexibility; on the other, you can spread your tax break over other years.
Regardless of your choice, purchasing the Jeep Gladiator would be worth it.
