Tax

Do you need a new business vehicle? 

Buying one before December 31, 2026, could deliver substantial tax savings, thanks to permanent 100 percent bonus depreciation and generous Section 179 deductions.

But not all vehicles qualify for the same tax benefits. Here’s what you need to know.

1. Heavy SUVs and crossovers. New or used SUVs with a gross vehicle weight rating (GVWR) exceeding 6,000 pounds may qualify for 100 percent bonus depreciation. Buy a $70,000 SUV used 90 percent for business, and you could deduct the entire $63,000 business cost in 2026.

2. Heavy pickup trucks. Qualifying pickups with a GVWR over 6,000 pounds and a cargo bed at least six feet long can qualify for 100 percent bonus depreciation or Section 179 expensing.

3. Cargo and passenger vans. Certain heavy vans also qualify for 100 percent bonus depreciation or generous Section 179 deductions, provided they meet specific requirements.

4. Cars and lighter vehicles. These vehicles face stricter depreciation limits. For 2026, the maximum first-year deduction is generally $20,300, including bonus depreciation, assuming 100 percent business use.

5. Electric vehicles. Federal electric vehicle purchase credits expired September 30, 2025. However, electric vehicles generally fall into the categories above and remain eligible for depreciation deductions or Section 179 expensing.

Don’t miss the deadline! You must purchase your vehicle and place it in business service by December 31, 2026. Driving at least one business mile helps document that requirement.

The bottom line. Vehicle selection, business use, and timing determine your deductions.

If you want to discuss vehicle purchase deductions, please call me directly at 408-778-9651

• By Leon Clinton
• November 13, 2026

The clock ticks on your 2026 tax deductions. Fortunately, six straightforward year-end business strategies can help you reduce taxable income and keep more money in your pocket.

1. Prepay business expenses. If you use cash-basis accounting, IRS safe-harbor rules generally allow you to deduct qualifying expenses prepaid up to 12 months in advance. Consider prepaying rent, equipment leases, or business insurance before December 31.

2. Delay customer billing. Cash-basis businesses can postpone billing customers, clients, or patients until January. This shifts income into 2027, postponing the related taxes.

3. Buy business equipment. Do you need computers, machinery, furniture, or office equipment? Qualifying purchases placed in service before December 31 qualify for 100 percent bonus depreciation or Section 179 expensing.

4. Use credit cards strategically. Business expenses charged before December 31 to your credit card (if you’re a sole proprietor) or your corporation’s credit card are deductible in 2026. If you operate as a corporation and use your personal credit card, the corporation must reimburse you by December 31 to claim the deduction.

5. Claim every legitimate deduction. Don’t overlook expenses simply because they create a business loss. Qualifying net operating losses may provide valuable deductions in future years.

6. Deduct building improvements. Certain improvements to non-residential buildings qualify for immediate expensing through bonus depreciation or Section 179, rather than depreciation over 39 years.

Key point. Small changes in your December business activities can produce substantial tax savings.

If you want to discuss any of the above, please call me directly at 408-778-9651

• By Leon Clinton
• November 10, 2026

If you own a tax code–defined pass-through business, such as a sole proprietorship or an S corporation, the Section 199A deduction could save you thousands in federal income taxes. 

This valuable deduction, now permanent, lets eligible business owners deduct up to 20 percent of qualified business income (QBI).

For 2026, new rules provide greater flexibility, including wider income phase-in ranges and a $400 minimum deduction for qualifying taxpayers.

But your deduction could shrink or disappear as your taxable income rises. Before December 31, consider these eight Section 199A tax-saving strategies:

1. Harvest capital losses. Selling losing investments can reduce taxable income and potentially increase your Section 199A deduction.

2. Make charitable contributions. Deductible donations, including appreciated stock, can lower taxable income without reducing QBI.

3. Buy business equipment. Qualifying purchases placed in service before year-end may generate immediate deductions.

4. Maximize personal deductions. Health savings account contributions, deductible state and local taxes, mortgage interest, and certain 401(k) deferrals can help.

5. Fund retirement accounts. Retirement contributions may reduce taxable income enough to increase your deduction.

6. Review W-2 wages. Additional wages or bonuses may increase the deduction for certain businesses subject to wage limitations.

7. Evaluate Roth conversions. Converting a traditional IRA to a Roth could increase taxable income and reduce your Section 199A deduction.

8. Review rental properties. Profitable rental activities may qualify for additional Section 199A deductions.

If you want to discuss the 199A deduction, please call me directly at 408-778-9651

• By Leon Clinton
• November 5, 2026