Last year, the IRS gave business owners a bonus depreciation for business vehicles.  That’s gone, and limits are sharply lower.

For passenger cars placed in service this year, the first-year dollar limit on depreciation is $3,160; the second year’s limit is $5,100; the third’s is $3,050 and $1,875 for each succeeding year. Of course, the limits are reduced if there is any personal use of the vehicle.

For light trucks and vans, the deduction limit is $3,460 the first year, then $5,500 and $3,350, then $1,975 after that.

It will cost more to lease a vehicle this year. The deduction is reduced in an attempt to equate the tax for leasing a vehicle with that for owning one. IRS tables spell out what the lessee must pay in income tax each year to partially offset the tax deduction on the lease. The new figures apply to leasing cars valued at over $18,500 and trucks and vans worth over $19,000.

For nearly 30 years, Mike Nickerson has owned and managed a small, full-service accounting practice in the Midcoast. He holds a bachelor's degree in accounting from University of Southern Main and a master's degree in financial planning from Bentley University.

He is a past board member and president of the Maine Society of Certified Public Accountants and currently serves on the Maine Board of Accountancy.

An aged rock musician, Nickerson now finds musical enjoyment playing upright and electric bass in a variety of bands spanning folk to jazz music genres. He and his wife have three grown children, and they enjoy their free time hiking, kayaking, golfing, bicycling and motorcycling.

http://www.nickersonpa.com/