Why You Should Use Section 179 in 2025 to Buy a Bus or Van Before Year-End

If your organization (childcare, private school, church, nonprofit, senior care, tour/charter business) is thinking of upgrading transportation — a bus or van purchase — then now (in 2025) is an especially powerful year to act because of tax incentives. By using Section 179, you may be able to deduct a large portion (or even all) of the cost in the same tax year that you place the vehicle into service. Here’s what you need to know — and why acting before the end of 2025 could save you thousands.

What is Section 179?

Section 179 allows businesses to elect to expense the cost of qualifying property (rather than depreciate it over many years) in the year the property is placed in service. For vehicles and equipment used by your organization, this means big upfront savings — which is especially helpful when buying a bus or van.

What’s new + especially beneficial in 2025

• For tax years beginning in 2025, the maximum Section 179 deduction is $2,500,000. 

• The phase-out threshold begins when total qualifying property placed in service exceeds $4,000,000. 

• Vehicles used more than 50% for business purposes can qualify — your bus/van purchase used for your organization’s operations fits this. 

• For heavy vehicles (vehicles over 6,000 lbs GVWR) and certain commercial vehicles, the tax benefits can often allow you to deduct most or all of the cost in year one. 

• Because you’re placing the equipment (bus or van) into service in 2025, you can capture the deduction in this tax year — improving cash flow, reducing tax burden, and letting you move ahead with your vehicle sooner.

Why this matters for bus and van purchases

If your organization is looking at a new bus (say a 24-passenger, 14,500 lb GVWR, or other commercial shuttle), or a commercial-use van (for daycare routes, senior transport, church mission trips, etc), here’s how the deduction works:

• Because many of these vehicles exceed 6,000 lbs GVWR and are used exclusively or primarily for business/organization purposes, they are strong candidates for full or near-full expensing in 2025 under Section 179.

• By purchasing and placing the vehicle into service before December 31, 2025 (year-end), you lock in the deduction for the 2025 tax year.

• This means that instead of spreading the cost of the vehicle over many years (via depreciation), you get a large deduction up front — reducing your taxable income this year, freeing up cash, and accelerating ROI on your investment.

• Especially for non-profits, schools, churches, senior care facilities or daycare centers that run their own transportation, this deduction can make the difference in making the purchase feasible now rather than delaying.

What you’ll want to check & document

To make sure you capture the deduction properly, be sure you do the following:

• Confirm business/organization use is > 50%: The vehicle must be used more than half the time for your business or organizational purposes.

• Check the vehicle’s Gross Vehicle Weight Rating (GVWR): Heavy vehicles tend to qualify for more favorable treatment. For buses and large vans, you’ll likely be in the advantageous category.

• Place the vehicle into service in 2025: It must be used (not just purchased) before December 31, to qualify for the deduction in that tax year.

• Keep good records: Purchase invoice, date placed in service, mileage logs (if you mix business/personal use), percentage of business use.

• Coordinate with your tax advisor: Especially if you have multiple purchases, or are near the phase-out limits, or you mix vehicle types.

• Ensure you’re under the phase-out threshold: If your total qualifying purchases exceed the threshold ($4 million in 2025) the deduction may reduce dollar-for-dollar.

• Consider bonus depreciation and how it interacts: In many cases you may combine Section 179 with bonus depreciation for maximum deduction.

Real-World Scenario

Let’s say your private school is planning to purchase a purpose-built 24-passenger shuttle bus for $90,000 and you expect 100% of the use is for school transportation. If placed into service by year-end 2025:

• You may elect to use Section 179 and deduct the full cost (assuming you haven’t exceeded limits and you satisfy use)

• That means your taxable income for 2025 would be reduced by $90,000 (plus other eligible equipment)

• That tax savings may free up funds to invest further in your school transportation program or handle other operating needs

• Because the deduction applies now, the cash flow benefit is immediate rather than waiting years for depreciation to work out

For daycare centers, senior care facilities, churches, non-profits, this same strategy applies: invest now, deduct now, benefit now.

Why You Should Act Before the End of the Year

• The tax deduction is tied to the year the vehicle is placed into service. If you wait until 2026, you lose the ability to claim it on your 2025 return.

• Manufacturers, dealers, and financing sources often have year-end incentives (especially for buses and vans) making purchase and placement easier.

• Your organization will start using the vehicle sooner, giving you operational benefits (better transport, greater capacity, improved safety) and tax benefits simultaneously.

• Waiting means you defer not just the deduction, but potentially higher purchase prices, interest/financing costs, and lost years of use.

Final Thoughts

If your organization has been on the fence about upgrading or adding a bus or van, 2025 offers one of the most favorable windows in recent years because of the enhanced Section 179 limits and vehicle eligibility rules. By acting before December 31, you position yourself to pull the purchase cost forward into this tax year — improving cash flow, reducing taxable income, and getting this asset working for your organization sooner.

👉 Next step: Talk with your accountant or tax professional today to confirm how this applies to your specific situation, set the timeline with your dealer, and ensure you meet the “placed into service” requirement by year-end. Then choose the right bus or van for your organization and make the purchase. Your 2025 tax return will thank you.  Contact us to reach a transportation specialist.