Back in the 60's when I got my BBA in accounting, I was taught to take a deduction if it appears legitimate. Your chances of being audited are low and the IRS must prove intent to defraud in order to collect anything more than back taxes and interest. I purchase 10 year old trucks and completely rebuild them before I put them on the road. The rebuild normally costs more than the initial cost of the vehicle. I depreciate the the total cost just like I would any other business vehicle.
For personal transportation in my business, I trade for a new 3/4 ton every 3 years and expense every bit of it. I have been through several IRS audits. The main test is that I have another personal vehicle and that I insure the vehicle with a commercial policy. I don't use any of my jalopies for business purposes, but if I did, I would insure them under a commercial policy and depreciate just as I would any other asset.
Again, the most important test is that you insure it as a commercial vehicle and that you have a vehicle dedicated to personal use.
The initial cost plus repairs becomes the basis of the cost of the asset.
