I have a question about the mileage deduction rules when filing a tax return. Should I use the standard mileage deduction or claim actual auto expenses?
To determine if you would benefit most from the standard mileage deduction or actual vehicle expenses you will have to review your specific circumstance. choice based on your specific situation.
Standard mileage is available unless:
- You use more than five vehicles at one time for your business.
- You claimed actual expenses after 1997 for a vehicle you leased.
- You claimed actual expenses in the first year you used the vehicle for business.
- You’re a rural mail carrier who received a qualified reimbursement.
- You claimed a depreciation deduction other than straight-line depreciation for your vehicle in a prior year.
Both methods require you to keep track of:
- Your business and personal mileage
- The business purpose for all business mileage
If you use the actual expense method, you’ll also need to keep track of receipts for your vehicle’s:
- Gas and oil
- Interest paid
- Other automobile expenses
Regardless of the method you use, you can claim the business percentage of these:
- Personal property taxes paid
- Any tolls and parking fees
If you’re self-employed, you can only deduct interest expenses and personal property taxes for your business auto expenses. These expenses aren’t permitted for employee vehicle expenses.
What is a CPA, and how can one help you with preparing your taxes? Understand the role of a certified public accountant with the experts 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’s the difference between an enrolled agent (EA) vs. a certified public accountant (CPA)? Explore the roles of EAs and CPAs at H&R Block.
Looking for virtual tax help with your online filing? Learn more about your options by comparing TurboTax Live to H&R Block Tax Pro Review and Tax Pro Go.