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IRS Issues 2010 Updates for Automobile Depreciation Deduction Limits

Please note: This item is from our archives and was published in 2010. It is provided for historical reference. The content may be out of date and links may no longer function.

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The IRS provided the 2010 inflation adjustments to the depreciation limitations and lease inclusion amounts for certain automobiles under IRC § 280F (Revenue Procedure 2010-18).

For passenger automobiles (other than trucks or vans) placed in service during calendar 2010, the depreciation limit under IRC § 280F(d)(7) is $3,060 for the first tax year; $4,900 for the second tax year; $2,950 for the third tax year; and $1,775 for each successive tax year. Trucks and vans have higher limits: $3,160 for the first tax year; $5,100 for the second tax year; $3,050 for the third tax year; and $1,875 for each successive tax year.

IRC § 280F(c) likewise limits deductions for the cost of leasing automobiles, expressed as an income inclusion amount according to a formula and tables prescribed under Treas. Reg. § 1.280F-7. The revenue procedure provides an updated table of the amounts to be included in income by lessees of passenger automobiles and another for trucks and vans, in both cases with lease terms that begin in calendar 2010.