Log Your Way To Greater Savings

While you may already deduct your vehicle expenses and mileage, are you doing so correctly?

Drew Morales

Drew Morales

If you use your vehicle for both business and personal purposes, you must divide your expenses between business and personal use. You can divide your expenses based on the miles driven for each purpose.

While both standard mileage rate and actual vehicle expenses are two great ways to get tax deductions, you can’t use them jointly or switch between the two. For example, if you choose to use the standard mileage rate for a year, you cannot deduct your actual expenses for that year except for business-related parking fees and tolls.

Also, if you want to use the standard mileage rate for a vehicle you own, you must choose to use it in the first year the vehicle is available for use in your business. In later years, you can choose to use either the standard mileage rate or actual expenses. If you use the standard mileage rate for lease, you must choose to use it for the entire lease period (including renewals).

See It, Try It and Deduct It

Now that we have a basic knowledge of vehicle deductions, let’s look at a practical example. This will help you understand why tracking both deductions through the year is beneficial. Comparison will tell you which provides the best results for your practice.

Farrier Takeaways

You can choose either standard mileage rate or actual expense deduction, but the two cannot be used jointly or switched in between.

Smartphone apps can help track your mileage for tax reporting.

The percentage…

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Drew Morales

Drew Morales is a certified journeyman farrier from Colonial Heights, Va.

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