Select Vehicles Excluded From IRS “Listed Property” Rules
For the rules pertaining to the luxury auto rules, refer to Section - Vehicle Expenses.
Some vehicles are generally not thought of as being for personal use. Therefore, they are termed “qualified, nonpersonal-use vehicles” and are not subject to the IRSlisted property rules. The regulations §1.274-5(k) define these vehicles in great detail, indicating the features necessary to exempt them from the listed rules. Such vehicles are:
•Clearly marked police, fire, and public safety officer vehicles. A clearly marked public safety officer vehicle is a vehicle owned or leased by a governmental unit or any agency or instrumentality thereof, that is required to be used for commuting by a public safety officer who, when not on a regular shift, is on call at all times. (Reg Sec 1.274-5(k)(3))
To qualify, any personal use (other than commuting) of the vehicle outside the limit of the public safety officer's obligation to respond to an emergency must be prohibited by the governmental unit. To be “clearly marked” the vehicle’s painted insignia or words must make it readily apparent that the vehicle is a public safety officer vehicle. Thus, emergency responders who are not employed by either the fire department or police department receive the same treatment as those who work for the police or fire departments;
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Delivery trucks with seating only for the driver (or driver plus a folding jump seat);
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Any vehicle designed to carry cargo with a loaded gross vehicle weight over 14,000 pounds., Trucks and vans are exempt if the weight requirement is met or if they have been modified so that little personal use is likely., For example, a van that has only a front bench for seating, permanent shelving filling most of the cargo area, carries merchandise or equipment on a constant basis, and is painted with the company name will be considered a nonpersonal use vehicle;
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Passenger buses used as such with a capacity of at least 20 passengers;
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Ambulances and hearses, used as such;
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Bucket trucks (cherry pickers) and flatbed trucks;
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Cranes, derricks, forklifts and cement mixers;
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Dump trucks, including garbage trucks;
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Tractors, combines, and other special purpose farm vehicles;
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Refrigerated trucks;
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School buses;
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Qualified moving vans;
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Qualified specialized utility repair trucks; and
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Unmarked law enforcement vehicles if the use is officially authorized.
Qualified Non-Personal Use Vehicles
A truck or van that is a qualified non-personal use vehicle is also a vehicle exempt from the luxury auto rules. The truck or van must have been specially modified with the result that it is not likely to be used more than a de minimis amount for personal purposes. The regulations’ example of a qualifying nonpersonal use vehicle is a van with only a front bench for seating, in which permanent shelving that fills most of the cargo area has been installed, that constantly carries merchandise or equipment, and that has been specially painted with advertising or the company’s name. These specially manufactured or modified vehicles do not provide significant elements of personal benefit, and a taxpayer is not likely to purchase this type of truck or van unless there was a valid business purpose that could not be met with a less expensive vehicle. (Reg. 1.280F-6)