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Should I take the standard mileage deduction or actual expenses for the business use of my car?



Should I take the standard mileage deduction or actual expenses for the business use of my car?


The easy answer is "it depends". And you won't know until December 31st when you've tallied a year's worth of expenses and mileage. An older, low-efficiency truck, that stays local, will probably use actual expenses while a newer Prius will probably use standard mileage. Leased vehicles will likely use actual expenses.


To deduct either the standard mileage rate or your actual expenses, you must track your yearly mileage and your business mileage. Business miles don't include driving from your home to your regular job or to your second job (aka commuting). Business miles include driving between jobs or driving directly from your home to a temporary work location if you have a regular job location or if the temp location is outside your metro area.


To find actual expenses, the percentage of business miles is multiplied by expenses like gasoline, oil, repairs, insurance, and the vehicle purchase price for depreciation or the lease payments.

© 2020 by Dennis C. Carroll, Esq.