Ryan VaughnCOO of Incite Tax & Accounting. Ask me anything about your taxes.

One of the MOST Commonly Missed Tax Deductions!!!

21 Feb 2024 · 1 min

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In this segment, the presenter explains the two primary ways to deduct vehicle expenses for business use: the actual‑expense method and the standard mileage deduction. While some taxpayers think they can avoid tracking mileage by simply deducting the total amount spent on the car, the IRS requires proof of business use regardless of the method chosen. Therefore, a detailed business mileage log is essential; without it, an audit could disallow the deduction entirely. The speaker emphasizes that keeping accurate mileage records is mandatory to substantiate any vehicle‑related deduction.

Chapters

Let's talk about some tax deductions. Another tax deduction we can talk about is your car. You can either take the actual expenses or you can take your mileage deduction. Some people hear those 2 options alone as explained very simply like I just did, and they're like, oh, well, I don't want to keep track of my miles. I'm just going to write off what I actually spent on the vehicle. When you're using actual expenses, the IRS says, hey, will let you deduct the actual expenses of your vehicle that you used for business. That means if you're audited, you have to be able to prove how much you used the vehicle for business, and if you can't prove it, then none of it was used for business. How do you prove how much of your car was used for business? You keep track of your miles. So you are going to need a business mileage log regardless of what method you choose.