Car Depreciation Limits For S-corp

[Collyer]

s About Taxes)/car depreciation limits for S-Corp Advertisement Expert: John Stancil, CPA - 11/15/2012 Assuming 100% business use, can a company car(S-Corp) be 100% depreciated in 5 years?  Or must it follow the following depreciation chart:

Year 1 max depreciation amount: $11,160

Year 2 max depreciation amount: $5,100

Year 3 max depreciation amount:: $3,050

Year 4(+) max depreciation amount: $1,875

For instance, if an S-Corp purchases a $40,000 car(not an SUV) in 2012, can the $40k purchase price of the car be written-off via depreciation in 5 years using the straight-line method(i.e. $10k per year)?  Or would it take 14 years to fully depreciate(using the above depreciation chart)?

[Silvestre]

Mike,

Thanks for your question. You must use the depreciation amounts specified in Sec 280F, which you have cited.  However, the bonus depreciation is slated to expire at the end of 2012, so the first year limit would be even less.

Hope this helps.

John Stancil, CPA