rp-24-13.pdf

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26 CFR 601.105: Examination of returns and claims for refund, credit, or abatement;
determination of correct tax liability.
(Also Part I, §§ 280F; 1.280F-7.)

Rev. Proc. 2024-13

SECTION 1. PURPOSE
This revenue procedure provides: (1) two tables of limitations on depreciation
deductions for owners of passenger automobiles placed in service by the taxpayer
during calendar year 2024; and (2) a table of dollar amounts that must be used to
determine income inclusions by lessees of passenger automobiles with a lease term
beginning in calendar year 2024. These tables reflect the automobile price inflation
adjustments required by § 280F(d)(7) of the Internal Revenue Code. For purposes of
this revenue procedure, the term “passenger automobiles” includes trucks and vans.
SECTION 2. BACKGROUND
.01 For owners of passenger automobiles, § 280F(a) imposes dollar limitations on
the depreciation deduction for the year the taxpayer places the passenger automobile in
service and for each succeeding year. For passenger automobiles placed in service
after 2018, § 280F(d)(7) requires the Internal Revenue Service to increase the amounts
allowable as depreciation deductions by a price inflation adjustment amount that is
determined using the automobile component of the Chained Consumer Price Index for

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All Urban Consumers published by the Department of Labor (C-CPI-U).
.02 Section 168(k)(1) provides that, in the case of qualified property, the depreciation
deduction allowed under § 167(a) for the taxable year in which the property is placed in
service includes an allowance equal to the applicable percentage of the property’s
adjusted basis, referred to as “§ 168(k) additional first year depreciation deduction”
hereinafter. Pursuant to § 168(k)(6)(A), the applicable percentage is 100 percent for
qualified property acquired and placed in service after September 27, 2017, and placed
in service before January 1, 2023, and is phased down 20 percent each year for
property placed in service through December 31, 2026. Accordingly, the applicable
percentage for qualified property acquired after September 27, 2017, and placed in
service after December 31, 2023, and before January 1, 2025, is 60 percent. Pursuant
to § 168(k)(8)(D)(i), no § 168(k) additional first year depreciation deduction is allowed or
allowable for qualified property acquired by the taxpayer before September 28, 2017,
and placed in service by the taxpayer after 2019. For qualified property acquired and
placed in service after September 27, 2017, § 168(k)(2)(F)(i) increases the first-year
depreciation allowed under § 280F(a)(1)(A)(i) by $8,000.
.03 Tables 1 and 2 of this revenue procedure provide depreciation limitations for
passenger automobiles placed in service by the taxpayer during calendar year 2024.
Table 1 provides depreciation limitations for passenger automobiles acquired by the
taxpayer after September 27, 2017, and placed in service by the taxpayer during
calendar year 2024, for which the § 168(k) additional first year depreciation deduction
applies. Table 2 provides depreciation limitations for passenger automobiles placed in
service by the taxpayer during calendar year 2024 for which no § 168(k) additional first

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year depreciation deduction applies. The § 168(k) additional first year depreciation
deduction does not apply for 2024 if the taxpayer: (1) did not use the passenger
automobile during 2024 more than 50 percent for business purposes; (2) elected out of
the § 168(k) additional first year depreciation deduction pursuant to § 168(k)(7) for the
class of property that includes passenger automobiles; (3) acquired the passenger
automobile used and the acquisition of such property did not meet the acquisition
requirements in § 168(k)(2)(E)(ii) and § 1.168(k)-2(b)(3)(iii) of the Income Tax
Regulations; or (4) acquired the passenger automobile before September 28, 2017, and
placed it in service after 2019.
.04 Section 280F(c)(2) requires a reduction to the amount allowable as a deduction
to the lessee of a leased passenger automobile. Pursuant to § 280F(c)(3), the
reduction must be substantially equivalent to the limitations on the depreciation
deductions imposed on owners of passenger automobiles. Under § 1.280F-7(a), this
reduction is accomplished by requiring the lessee to include in gross income an amount
determined by applying a formula to a dollar amount obtained from a table.
.05 Table 3 of this revenue procedure provides the dollar amount used by lessees of
passenger automobiles with a lease term beginning in 2024 to determine the income
inclusion amount for those passenger automobiles. The table provides dollar amounts
for a range of fair market values.
SECTION 3. SCOPE
.01 The limitations on depreciation deductions in Tables 1 and 2 in section 4.01(2) of
this revenue procedure apply to passenger automobiles, other than leased passenger
automobiles, that are placed in service by the taxpayer in calendar year 2024, and

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continue to apply for each taxable year that the passenger automobile remains in
service.
.02 The dollar amounts in Table 3 of this revenue procedure apply to leased
passenger automobiles with a lease term beginning in calendar year 2024, and continue
to apply for each taxable year during the lease.
.03 See Rev. Proc. 2019-26, 2019-24 I.R.B. 1323, for passenger automobiles placed
in service or leased during calendar year 2019; Rev. Proc. 2020-37, 2020-33 I.R.B. 381,
for passenger automobiles placed in service or leased during calendar year 2020; Rev.
Proc. 2021-31, 2021-34 I.R.B. 324, for passenger automobiles placed in service or
leased during calendar year 2021; Rev. Proc. 2022-17, 2022-13 I.R.B. 930, for
passenger automobiles placed in service or leased during calendar year 2022; and Rev.
Proc. 2023-14, 2023-6 I.R.B. 466, for passenger automobiles placed in service or
leased during calendar year 2023.
SECTION 4. APPLICATION
.01 Limitations on Depreciation Deductions for Certain Automobiles.
(1) Amount of the inflation adjustment. Under § 280F(d)(7)(B)(i), the automobile
price inflation adjustment for any calendar year is the percentage (if any) by which the
C- CPI-U automobile component for October of the preceding calendar year exceeds
the automobile component of the CPI (as defined in § 1(f)(4)) for October of 2017,
multiplied by the amount determined under § 1(f)(3)(B). The amount determined
under § 1(f)(3)(B) is the amount obtained by dividing the new vehicle component of the
C- CPI-U for calendar year 2016 by the new vehicle component of the CPI for calendar
year 2016, where the C-CPI-U and the CPI for calendar year 2016 means the average

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of such amounts as of the close of the 12-month period ending on August 31, 2016.
Section 280F(d)(7)(B)(ii) defines the term "C-CPI-U automobile component" as the
automobile component of the Chained Consumer Price Index for All Urban Consumers
as described in § 1(f)(6). The product of the October 2017 CPI new vehicle component
(144.868) and the amount determined under § 1(f)(3)(B) (0.694370319) is 100.592.
The new vehicle component of the C-CPI-U released in November 2023 was 124.743
for October 2023. The October 2023 C-CPI-U new vehicle component exceeded the
product of the October 2017 CPI new vehicle component and the amount determined
under § 1(f)(3)(B) by 24.151 (124.743 - 100.592). The percentage by which the C-CPI-
U new vehicle component for October 2023 exceeds the product of the new vehicle
component of the CPI for October of 2017 and the amount determined under
§ 1(f)(3)(B) is 24.009 percent (24.151/100.592 x 100%), the automobile price inflation
adjustment for 2024 for passenger automobiles. The dollar limitations in § 280F(a) are
therefore multiplied by a factor of 0.24009, and the resulting increases, after rounding to
the nearest $100, are added to the 2018 limitations to give the depreciation limitations
applicable to passenger automobiles for calendar year 2024. This adjustment applies to
all passenger automobiles that are placed in service in calendar year 2024.
(2) Amount of the limitation. Tables 1 and 2 of this revenue procedure contain the
depreciation limitation for each taxable year for passenger automobiles a taxpayer
placed in service during calendar year 2024. Use Table 1 for a passenger automobile
to which the § 168(k) additional first year depreciation deduction applies that is acquired
by the taxpayer after September 27, 2017, and placed in service by the taxpayer during
calendar year 2024; use Table 2 for a passenger automobile for which no § 168(k)

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additional first year depreciation deduction applies.
REV. PROC. 2024-13 TABLE 1

DEPRECIATION LIMITATIONS FOR PASSENGER AUTOMOBILES ACQUIRED
AFTER SEPTEMBER 27, 2017, AND PLACED IN SERVICE DURING CALENDAR
YEAR 2024, FOR WHICH THE § 168(k) ADDITIONAL FIRST YEAR DEPRECIATION
DEDUCTION APPLIES

Tax Year Amount
1st Tax Year $ 20,400
2nd Tax Year $ 19,800
3rd Tax Year $ 11,900
Each Succeeding Year $ 7,160

REV. PROC. 2024-13 TABLE 2

DEPRECIATION LIMITATIONS FOR PASSENGER AUTOMOBILES
PLACED IN SERVICE DURING CALENDAR YEAR 2024 FOR WHICH NO § 168(k)
ADDITIONAL FIRST YEAR DEPRECIATION DEDUCTION APPLIES

Tax Year Amount
1st Tax Year $ 12,400
2nd Tax Year $ 19,800
3rd Tax Year $ 11,900
Each Succeeding Year $ 7,160

.02 Inclusions in Income of Lessees of Passenger Automobiles.
A taxpayer must follow the procedures in § 1.280F-7(a) for determining the
inclusion amounts for passenger automobiles with a lease term beginning in calendar
year 2024. In applying these procedures, lessees of passenger automobiles should use
Table 3 of this revenue procedure.

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REV. PROC. 2024-13 TABLE 3

DOLLAR AMOUNTS FOR PASSENGER AUTOMOBILES
WITH A LEASE TERM BEGINNING IN CALENDAR YEAR 2024

Fair Market
Value of
Passenger
Automobile
Over

Fair Market
Value of
Passenger
Automobile
Not Over

1
st
Tax
Year
During
Lease

2
nd
Tax
Year
During
Lease

3
rd
Tax
Year
During
Lease

4
th
Tax
Year
During
Lease

5
th
Tax
Year
During
Lease &
Later

$62,000 $64,000 7 16 24 28 32
64,000 66,000 21 47 69 82 94
66,000 68,000 35 77 114 136 157
68,000 70,000 49 107 159 191 219
70,000 72,000 62 138 204 245 281
72,000 74,000 76 168 250 298 344
74,000 76,000 90 199 294 353 406
76,000 78,000 104 229 340 406 469
78,000 80,000 118 259 385 461 531
80,000 85,000 142 313 463 556 640
85,000 90,000 177 388 577 690 797
90,000 95,000 211 465 689 826 952
95,000 100,000 246 541 802 961 1,108
100,000 110,000 298 655 971 1,163 1,343
110,000 120,000 367 807 1,196 1,435 1,655
120,000 130,000 437 958 1,423 1,704 1,968
130,000 140,000 506 1,111 1,647 1,975 2,280
140,000 150,000 575 1,263 1,873 2,245 2,592
150,000 160,000 645 1,414 2,099 2,516 2,904
160,000 170,000 714 1,566 2,325 2,786 3,216
170,000 180,000 783 1,719 2,549 3,057 3,529
180,000 190,000 852 1,871 2,775 3,327 3,841
190,000 200,000 922 2,022 3,001 3,598 4,153
200,000 210,000 991 2,175 3,226 3,868 4,465
210,000 220,000 1,060 2,327 3,452 4,138 4,778
220,000 230,000 1,130 2,478 3,678 4,409 5,089
230,000 240,000 1,199 2,631 3,902 4,680 5,402
240,000 and over 1,268 2,783 4,128 4,950 5,714

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SECTION 5. EFFECTIVE DATE
This revenue procedure applies to passenger automobiles placed in service during
calendar year 2024 or with a lease term beginning in calendar year 2024.
SECTION 6. DRAFTING INFORMATION
The principal author of this revenue procedure is C. Dylan Durham of the Office of
Associate Chief Counsel (Income Tax & Accounting). For further information regarding
this revenue procedure, contact Mr. Durham at (202) 317-7005 (not a toll-free number).