If you happen to use your personal vehicle for business purposes or you have a vehicle dedicated to you by your business you may be able to deduct some of the expense need to keep it road worthy. While learning how to effectively manage your auto expenses the deductions can be well worth the time.
You can claim deductions for auto expenses one of two ways, either by taking the standard deduction or using the Actual expense method. If you decide to use the actual expense method you will have to keep an itemized log of all of your costs. You will get a standard mileage reimbursement of .56 cents per mile driven for business, this does not include the fee for parking or tolls.
If you use the itemized method many times newer car will lead to a bigger deduction. By using the itemized method you can deducted the depreciation of the vehicle as well. If you have claimed accelerated depreciation in previous year you cannot change to the standard deduction.
If you happen to use the same vehicle for both personal and business use you can only claim the portion of the time that you use the vehicle for business purposes. Since you can only claim the use for business purposes you will have to keep track of when and how you use the vehicle and total it at the end of the year. If you only own one car you will never succeed in trying to claim 100% of it for business deductions.
