BY PHIL SHETSEN
As a member of this industry, you already know the end of the year isn’t just about holiday bookings; it’s also about finding smart ways to reduce your tax bill. For years, one of the best tools in your arsenal has been bonus depreciation: buying new vehicles and writing off most (or all) of the cost right away.
Now, thanks to new legislation, that advantage is here to stay.
Bonus Depreciation Made Permanent
The One Big Beautiful Bill Act (OBBBA), passed in July 2025, permanently reinstated 100% bonus depreciation. That means whenever you purchase qualifying vehicles or equipment, you can continue deducting the full value in the year of purchase, without worrying about the phase-out that was originally scheduled to end in 2027.
This is a major win for capital-heavy industries like yours. You can plan vehicle purchases knowing the deduction will always be there. But while bonus depreciation provides immediate relief, it’s tied to depreciating assets, which are vehicles that lose value over time and may generate taxable income when sold.
That’s why many business owners are also turning to appreciating assets like retirement plans that not only reduce taxes today but also grow wealth for the future.
Turn to Tax-Deductible Retirement Plans Too
Even with bonus depreciation renewed and secured for the foreseeable future, retirement plans remain one of the most powerful tools for cutting taxes while building long-term financial security. Cross-tested 401(k)s, profit-sharing, and pension plans are flexible, tax-advantaged strategies that work alongside your vehicle purchases.
❱ Cross-Tested 401(k)
This plan lets you contribute different amounts for different employees and is ideal for owners and key team members. As of 2023, you can contribute up to $66,000 annually, all tax-deductible.
❱ Profit Sharing
Make contributions based on company profitability each year. It’s flexible—share more in strong years, less in lean years—while still lowering taxable income.
❱ Pension Plan (Defined Benefit)
While becoming a rarer and rarer option, if you want to maximize contributions, a pension plan allows for over $300,000 annually, depending on age and income. It creates guaranteed retirement benefits and substantial tax savings.
Designed With Your Business in Mind
Only employees who work at least 1,000 hours per year are eligible for employer contributions, helping you manage costs while rewarding your core staff. Plus, these plans are customizable so you’re not locked into contributions you can’t sustain.
Work With a Tax Advisor to Get It Right
Between vehicle purchases, depreciation rules, and retirement plan options, the best strategy is a balanced one. A qualified tax advisor or financial planner can help you: ❱ Maximize the permanent 100% bonus depreciation ❱ Layer on retirement plans for long-term savings ❱ Tailor contributions to fit your business goals and cash flow
With OBBBA making 100% bonus depreciation permanent, business owners in the chauffeured car and charter industries can keep using vehicle purchases as a reliable tax deduction. But don’t stop there. Retirement plans give you another lever, delivering tax savings now while building wealth for the future. Talk to a financial advisor about creating a strategy that uses both to strengthen your bottom line. [CD1025]
Phil Shetsen is the president of Bona Vita Benefits. He can be reached at
