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Are Car Expenses Tax Deductible?

First, Sant Automotive does not provide tax advice, and we strongly urge our readers to check this information with their tax advisors. That said, both employees and business owners who use their vehicles for business purposed may be able to deduct certain expenses. When thinking about deducting business expenses, there are a few key items to remember.

First, understand that not all expenses are deductible. For example, commuting to and from work is not a recognized, tax deductible expense, and it does not matter if you are conducting business or transporting work materials. The IRS still sees these activities as being part of commuting.

Record keeping is an integral part of deducting automobile expenses. The IRS allows two different methods for deducting these expenses: actual expense and standard mileage deduction. You must choose one or the other. In 2019, the IRS allowed a standard deduction of $.58 per mile for business related travel. Actual expenses that may be deductible include, fuel, licenses, insurance, repairs, maintenance, titling fees, insurance, tolls, parking, depreciation, and interest expense. For more information, please consult your tax professional, and make sure to keep good records.

For more information about the deductiblity of car expenses, check out this link to the IRS.