I bought a new car in 2018. When I used it for business, I was paid a mileage reimbursement. Can I still claim a depreciation credit on my tax return for my vehicle?
If you took a mileage reimbursement from your company you are most likely not eligible to claim a depreciation credit for the same vehicle on your tax return. The reason being, mileage reimbursement includes a depreciation component as well. Therefore, you cannot claim depreciation in addition to the reimbursement.
Your employer might have included the reimbursement in your wages on your W-2. If so, you can deduct your transportation expenses. You can deduct the expenses using either:
- The standard mileage rate — for miles driven
- Actual expenses — for those allocated to the business use of the vehicle. Actual expenses will include depreciation.
Related Resources
Changing jobs can come with tax implications like job search and moving expense deductions. Learn more about these potential benefits at H&R Block.
Do you have unreimbursed expenses to include on your tax return? Learn how to claim unreimbursed employee expenses with IRS Form 2106.
What does it mean to be an enrolled agent? Learn more about the roles and requirements of enrolled agent (EA) tax preparers at H&R Block.
Virtual tax preparations let you complete your taxes online from the comfort of your home. Find out how easy remote tax preparations can be at H&R Block.
