Tax Benefits in The United States
Under the United States income tax code, the cost of vehicles over 6,000 pounds (2,700 kg) can be deducted from specific forms of income. This deduction was enacted decades ago to assist self-employed people in purchasing a vehicle for business use. The weight minimum was intended to limit the deduction to commercial-type trucks. For many years, the deduction remained below the average cost of a new vehicle, since large trucks were relatively inexpensive. Since it is a reduction in taxable income, the actual value of this deduction averages 30% of the price of the vehicle in question.
The increasing popularity of these commercial vehicles in the last decade, however, pushed their average price to nearly double the average passenger car cost. In response, the 2002 Tax Act increased this "Section 179 depreciation deduction" to US$75,000, and it rose again to US$102,000 for the 2004 tax year. This is more than three times the current average cost of a passenger car in the United States and covers a large number of luxury models, including the Hummer H2. In late 2006, the deduction was again reduced to US$25,000 for vehicles with GVWR between 6,000 lb (2,700 kg) and 14,000 lb (6,400 kg).
Base price MSRP in 2008 for the H2 is $53,286.
Read more about this topic: Hummer H2
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