Section 179 Vehicle. How to define the workplace?

Question

Hello,

I am trying to see if the section 179 vehicle deduction would apply for my case.

I have a W2 full time job, as well as short term rentals:

- W2 job takes 40hr of my time 4d/week at the office, 1d/week from home

- I visit the short term rentals 1-2 days/week total.

I understand that Home-Worplace commute does not qualify for 179. However, how is the "workspace" defined?

- The place where I do most of my "work" (W2 office)?
- The place where I spend most of my working time? (Home office: W2 remote work + Rental paperwork + investment research + short term rental communication/advertisement...)
- The office that makes the most money? (for 2017 it was the W2 office, but 2018 or 2019 might be the home office (rentals))

Thank you!

Ashish Acharya · Answer

@Mike H. ,

Section 179 deduction is for the asset not for the mileage or commute you are referring to.

Vehicle qualified for sec 179 deduction if it is used for the business, but cannot go below 50% business use.

The amount of deduction is based on the type of vehicle too.  Moreover, you cant take section 179 deduction if you have net loss and is limited to taxable income.

ALso,

• Property acquired and first used for personal purposes can’t qualify as Section 179 property upon conversion.
• Property bought and placed in a service before an active trade or business has started cannot qualify as well.

I do not know your situation to tell you exactly.

If you were talking about the mileage deduction, let me know. I can clarify that.