Here is one that surprises people. If you use a classic or antique car in your business, you may be able to depreciate it just like a newer vehicle. The key is real business use. The vehicle has to be subject to wear and used in your trade or business. Courts have allowed depreciation on valuable antique assets used in business even when those assets went up in value.
That opens an interesting door. A 1972 Pontiac GTO used in business may qualify for depreciation much like a 2026 Lexus IS would, because current law generally treats new and used vehicles the same way for depreciation. The appeal is partly economic: while a classic car can cost more to repair and run, it may hold or grow its value far better than a new car that loses value the moment you drive it off the lot.
One limit to keep in mind: passenger automobiles are still subject to the luxury-auto depreciation caps. For a car placed in service in 2026 and eligible for bonus depreciation, the first-year write-off is capped, so you generally cannot deduct the full purchase price in year one.
The catch most people miss is substantiation. A vehicle used in business is treated as listed property, which means the IRS expects real proof of how much you drive it for business versus personally: a mileage log with dates, destinations, and business purpose. Accelerated and bonus depreciation generally require business use above 50 percent, and if your business use later drops below that line, part of the depreciation you already claimed can be recaptured and added back to your income. A beautiful car with a thin logbook is exactly the kind of deduction that does not survive a closer look.
There is also a choice of methods. You can deduct your actual costs (depreciation, fuel, insurance, and repairs) for the business-use share of the car, or use the standard mileage rate, and which one wins depends on how expensive the car is to run and how many business miles you actually drive. Personal use is never deductible, so a car that is mostly a weekend showpiece with the occasional business errand produces a small deduction, not a large one. The benefit tracks genuine business use, and the more unusual the asset, the more your documentation has to carry the weight.
What this means for you: If a classic car genuinely fits your business, it can be a legitimate and enjoyable asset, not just a hobby. Before you buy, let us model the depreciation and the luxury-auto limits so you know the real tax picture going in.
