Can I write off my work truck? A contractor's guide to vehicle and equipment deductions.
By Doug Johnson, CPA - Updated August 2026
Yep - if you use a truck for business, it's deductible. The real questions are which method to use, how fast you can deduct expenses (heavier work trucks can often be written off 100% in year one), and what your state allows - some states, including California (where a lot of our clients operate), allow for far less depreciation than the IRS. Below, I’ll explain how vehicle expenses work.
Two options for deduction - standard mileage vs. actual expenses. Which is better?
You've got two ways to deduct a business vehicle, and you can't stack them:
Standard mileage: allows you to recognize a deduction at a flat rate per mile. For '26 there are actually two applicable rates due to a mid-year adjustment made by the IRS (the first since 2022): 72.5¢/mile for miles driven January through June, and 76¢/mile for miles driven July 1 onward. The rate is designed to cover gas, insurance, repairs, and depreciation - meaning you don’t get a separate deduction for individual vehicle-related expenses.
Actual expenses: allows you to deduct the business-use percentage of everything your vehicle really costs - fuel, insurance, repairs, tires, registration, loan interest - plus depreciation on the truck itself.
So which method wins? It depends, but as a rule of thumb, high miles on an inexpensive vehicle favors the mileage rate, while an expensive work truck with normal miles favors actual expenses. With actual expenses, the depreciation on a 70 - 80K truck dwarfs what the per-mile rate would ever give you. That said, we strongly recommend you consult a CPA on this - as each set of circumstances is different.
Choose carefully in year one, because the choice locks you in for the life of the vehicle. If you want the option to use standard mileage on a vehicle, you must use it the first year that vehicle is in service. And if you take Section 179 or accelerated depreciation on a truck, that vehicle can't switch to the standard mileage rate later. See IRS Topic 510 for the pick-one-method rules.
We’ll discuss this in more detail later, but do keep in mind that in each case, assuming the vehicle is seeing some personal use, you’re required to keep detailed mileage records that show the split between business vs personal miles.
Section 179 and bonus depreciation: the Year 1 write-off
If you go the actual-expense route, Section 179 and bonus depreciation (which is now permanent under current law for property acquired after 1/19/25) can put most or all of a work vehicle's cost into Year 1, instead of spreading it over 5+ years.
And here's the distinction that matters in the trades - it comes down to the 6,000 lbs GVWR line and what kind of vehicle it is:
Under 6,000 lbs GVWR (most sedans, small SUVs): the "luxury auto" caps apply, limiting the first-year deduction to $20,300 for '26 even with bonus depreciation ($12,300 without). The rest spreads over later years.
Over 6,000 lbs GVWR, SUV-type: escapes the luxury caps, but a special SUV cap limits the Section 179 piece ($32,000 for '26) - though bonus depreciation can still take the rest.
True work vehicles - cargo vans with no seating behind the driver, pickups with a full-size (6-foot+) bed, vehicles over 14,000 lbs etc: generally exempt from the SUV cap entirely and typically qualify for the full Year 1 write-off.
Note that heavy work trucks have become one of the most powerful Year 1 deductions in the code - which is exactly why the IRS pays close attention to how they get claimed (more on that below).
Example: let’s say an electrician business buys two ~$45K cargo vans. Expensing them fully in Year 1 via bonus depreciation versus taking the mileage rate is a swing of tens of thousands of dollars in first-year deductions - but it also means that that big Year 1 deduction means little or no depreciation left for later years. If one year's income is unusually low, electing out of bonus depreciation can actually be worth more over the long term.
As an example, one of our clients (a ~2.5M landscaping business) had a relatively low-income year in 2024 as they restructured their business, ramped up advertising, and invested in equipment. Since we expected income to rebound in 2025 and beyond, we advised them to opt out of bonus depreciation for ‘24, because that depreciation would be offsetting income that hit a low tax bracket already. This proved to be an excellent tax planning move - the business had a massive year in ‘25 and is poised to have a big year in ‘26 as well, and the depreciation from the vehicles purchased in ‘24 is offsetting income hitting higher tax brackets.
The catch on the state side
Before you build a truck purchase around a big federal write-off, check the state side - not every state conforms to the federal Section 179 and bonus depreciation rules, and the gap can be large. We strongly recommend consulting a CPA before making any large equipment purchases to understand the state impact.
Take California, for instance. Since California doesn't allow bonus depreciation at all, any bonus depreciation you claim federally gets added back on your CA return. Similarly, CA caps its own Section 179 deduction at $25K (see the FTB's depreciation rules). The same truck ends up with two very different depreciation schedules, and your CA return shows meaningfully higher income than your federal return in year one. Here's what that looks like:
An $80K Ford F-350 purchased in CA (over 6,000 lbs GVWR, full-size bed, 100% business use):
Federal year-one deduction: ~$80K - the full cost, via Section 179 / bonus depreciation
California year-one deduction: ~$36K - the $25K CA Section 179 cap, plus ~$11K of regular depreciation on the remainder
That ~$44K gap is a timing difference - CA catches up through regular depreciation in later years - but this can be a nasty surprise if you were expecting a large depreciation write-off on your state return. If you're planning a purchase around the federal deduction, make sure you understand the state-specific impacts as well.
Do note, also, that different states have different rules. Some states, like Colorado, allow for full bonus and Section 179 depreciation. Arkansas allows full Section 179 depreciation, but limits bonus depreciation. As such, it is critical to consult a CPA to understand the exact limitations on depreciation in your state.
The #1 audit item: personal use of your vehicle (and the mileage log)
Mixed business/personal use of a vehicle is one of the most commonly audited areas for trades businesses. Only the business-use percentage of your vehicle expenses (whether accounted for using the mileage or actual expense method) is deductible, and in the event of an audit, you need to have a mileage log to substantiate the business/personal split. Without a mileage log, the IRS and state tax agencies can disallow your vehicle deductions entirely.
As such, we strongly recommend clients stay disciplined about using a mileage logging app like MileIQ. Keeping a clean mileage log can literally save you thousands of dollars and huge amounts of stress if you're ever audited. Beyond that, we always recommend clients keep expense claims reasonable (ex. don’t claim an expensive luxury sedan as a 100% business-use vehicle).
FAQ
Can I write off 100% of my truck if I also drive it home?
Commuting is generally personal use, so a truck that's also your daily driver won't be 100% business - the deduction follows your documented business-use percentage.
Is it better to buy or lease for the write-off?
Buying opens the door to Section 179 and bonus depreciation, while with a lease, you deduct the business-use share of the lease payments instead. While Year 1 deductions will be larger with a purchase, leasing will yield more consistent deductions over time. Ultimately, this is a personal choice as well - if you like switching vehicles every couple years, it makes more sense to lease vs buy.
Does wrapping my truck in my company logo make it 100% business use?
Nope - advertising on the vehicle doesn't convert personal miles into business miles. The wrap itself is deductible as advertising, but the business-use percentage is still based on the actual usage pattern of the vehicle.
What if I already took 179 on a truck and now want to use mileage?
Unfortunately, you can’t. Once a vehicle has taken Section 179 or accelerated depreciation, standard mileage is off the table for that vehicle for good. However, you can still deduct actual operating costs by business-use percentage going forward.
Related: How Do I Pay Myself From My Trades Business? · Why Is My Trades Business Profitable on Paper but Broke in the Bank?
Doug Johnson, CPA is the owner of Doug Johnson CPA, a boutique accounting firm serving specialty trades and home services businesses nationwide. Planning an equipment purchase? Book an intro call.