Auto Expenses You Can Actually Deduct
by Niman Singh
Vehicle expenses paid exclusively for rental activity can be fully deductible.
Using the actual expense method instead of standard mileage might be more beneficial if your vehicle incurred a lot of expenses during the year.
Usually the largest vehicle expense that you can deduct is depreciation, which allows you to deduct the value of your vehicle over a period of 5 years.
Many times, depreciation is the factor that determines which expense method will be used.
Other deductible costs include car insurance, DMV registration fees, tolls, parking, gas, oil changes, tune-ups, tires, maintenance, etc¦ When deducting actual vehicle expenses, it is very important to keep a track of costs and receipts. If you do not use the vehicle solely for rental activity, then you should keep a record of mileage traveled for your business, so you can deduct a percentage of the vehicle’s actual expenses.
Whether using the standard mileage or actual expense deduction, be sure to record all expenses related to your rental activity. You usually wont know which deduction method to use, so its best to just keep a journal of all vehicle activities.
For more Tax Tips and Tax Saving Web Tools like DepreciateEm.com and DeferEm.com, check out TReXGlobal.com.
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