Business Deductions
- Amortization
- Business Losses and Net Operating Losses
- Car and Truck Expenses
- Day-Care Services
- Depreciating Business Property
- Depreciating Your Car
- Domestic Production Activities Deduction
- Health Insurance Deduction
- Home Office Deduction
- Meal and Entertainment Expenses
- Organizational Costs and Start-up Costs
- Qualified Plan Awards
- Schedule C Expenses
- Section 197 Intangibles
- Should You Sell or Trade in Your Car?
- Start-up Costs
- Travel Expenses
More Tax Topics
- Business Structures
- Hiring Workers
- Retirement
- Top Tax Myths
- Per Diem Rates - IRS Publication 1542 Oct 2011 for Travel Within the Continental U.S (for employers who pay a per diem allowance to employees)
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Need Some Deductions for 2011?
Don't overlook these!
Updated for 2011
Small Business Deductions: Car and Truck Expenses
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Business and Personal Use of Vehicle
If you use your vehicle for both business and personal use, you can only deduct expenses that relate to the business use of the vehicle.
To allocate your vehicle's actual expenses to business use, multiply...
- Total annual operating expenses plus
- Depreciation by
- Your business use percentage
Reminder:
Annual operating expenses include items such as repairs and maintenance, insurance, tolls, parking fees, towing charges, interest on you vehicle loan, provided you are self-employed and not classified as an employee.
If you live in a state that assesses a personal property tax on your vehicle as part of the registration fee and you use your vehicle less than 100% for business, the business-use portion of the property tax is deductible as a business expense and the personal use portion is deductible on Schedule A and an itemized (call your state's DMV).
Determining Your Business Use Percentage:
- Divide total business miles traveled for the year by
- All miles traveled for the year (including business and personal).
Example:
Vehicle used from January 1st thru December 31st for business and personal use.
- Jack is self-employed
- Jack used his Honda Accord for both business and personal use from January 1, thru December 31st.
- Annual business miles traveled were 30,000 miles (based on Jack's mileage log)
- Total miles traveled for the year (business and personal) were 40,000 miles.
Result:
- Jack's business-use percentage is 75% (30,000/40,000)
Next:
Car Expenses: Changing From Personal Use to Business Use During the Year
Related Links
- Turning Commuting Mileage into Deductible Business Expense
- Personal Property Tax Included in Vehicle Registration Fee
- Sales Tax
- Alternative Motor Vehicles or Plug-in Electric Vehicle Conversions
- Audit Proofing Your Car Deduction
- Tracking Business Miles
- Estimates of Car and Truck Expenses
- Mileage Sampling
- Electric Cars
- Annual Depreciation Limits for Electric Cars
Copyright © 2008-2012 Larry Villano. All rights reserved.
