The Tax Cuts and Jobs Act of 2017 increases the dollar limitations on depreciation and expensing for passenger automobiles. Since the amounts will be adjusted for inflation after 2018, the limits for trucks, vans and passenger cars are the same. The amount of depreciation and expensing deduction should not exceed:
- $10,000 for the 1st taxable year
- $16,000 for the 2nd taxable year
- $9,600 for the 3rd taxable year
- $5,760 for each succeeding taxable year
The Tax Cuts and Jobs Act retained the $8,000 limit for additional first-year depreciation for passenger automobiles, so in 2018 the maximum amount a taxpayer can deduct for a passenger automobile in the first year is $18,000.
