Tax Guru-Ker$tetter Letter
Friday, October 22, 2004
The Wait Is Over
Bush Signs $136 Billion Corporate Tax-Cut Bill - The new limit for business SUVs under Section 179 will take effect tomorrow, October 23.
More Details: Bush Signs $136B Corporate Tax Cut Bill
Here is the actual text of the provision limiting SUVs to $25,000:
SEC. 910. EXPANSION OF LIMITATION ON DEPRECIATION OF CERTAIN PASSENGER AUTOMOBILES.
(a) IN GENERAL- Section 179(b) (relating to limitations) is amended by adding at the end the following new paragraph:
`(6) LIMITATION ON COST TAKEN INTO ACCOUNT FOR CERTAIN PASSENGER VEHICLES-
`(A) IN GENERAL- The cost of any sport utility vehicle for any taxable year which may be taken into account under this section shall not exceed $25,000.
`(B) SPORT UTILITY VEHICLE- For purposes of subparagraph (A)--
`(i) IN GENERAL- The term `sport utility vehicle' means any 4-wheeled vehicle--
`(I) which is primarily designed or which can be used to carry passengers over public streets, roads, or highways (except any vehicle operated exclusively on a rail or rails),
`(II) which is not subject to section 280F, and
`(III) which is rated at not more than 14,000 pounds gross vehicle weight.
`(ii) CERTAIN VEHICLES EXCLUDED- Such term does not include any vehicle which--
`(I) is designed to have a seating capacity of more than 9 persons behind the driver's seat,
`(II) is equipped with a cargo area of at least 6 feet in interior length which is an open area or is designed for use as an open area but is enclosed by a cap and is not readily accessible directly from the passenger compartment, or
`(III) has an integral enclosure, fully enclosing the driver compartment and load carrying device, does not have seating rearward of the driver's seat, and has no body section protruding more than 30 inches ahead of the leading edge of the windshield.'.
(b) EFFECTIVE DATE- The amendment made by this section shall apply to property placed in service after the date of the enactment of this Act.