Mileage expenses can be a tricky. The IRS expects you to have documentation on the dates of gasoline purchases, overall mileage, gas, tolls, parking costs, etc., as well as the purposes of your travel.
Uncle Sam expects you to separate your business usage vs. your personal driving and deduct only the business portion of your auto-related expenses. This includes the cost of insurance and repairs.
Today, many people lease their vehicles. If you lease, include those payments. If you bought your car, you can deduct the interest on your loan and depreciation on your vehicle.
There are two ways to deduct auto expenses. The IRS’s Standard Mileage Rate sets the amount that a taxpayer can claim for each mile driven for business purposes. In 2013, the figure was 56.5 cents per mile. Beginning on Jan. 1, 2014, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be 56 cents per mile for business miles driven.
The other way to deduct car expenses is the Actual Expense Cost method. The IRS lets the small business owner deduct the total amount of money paid to operate the vehicle for business use. This figure includes the cost of gas, insurance, licenses and vehicle registration fees, tires, repairs, tires, and parking
If you need money for your 2013 tax bill, Biz2Credit can help you get it. Call (877) 861-2210 toll free.