Can I Write This Off?

Can freelancers deduct can i write off gas and mileage?

TL;DR

Freelancers can generally deduct either gas and oil costs or a standard mileage rate for business use of their vehicle, but not both. It's important to maintain accurate records to substantiate the deduction.

Detailed Answer

Freelancers can deduct vehicle expenses if the vehicle is used for business purposes. They have two options: the standard mileage rate or actual expenses. The standard mileage rate, set annually by the IRS, covers gas, maintenance, and depreciation. Alternatively, they can deduct actual expenses like gas, oil, repairs, and insurance, but must prorate these costs based on the percentage of business use. Personal commuting is not deductible. For example, if a freelancer drives 10,000 miles in a year and 6,000 of those miles are for business, they can deduct 60% of their actual vehicle expenses or use the standard mileage rate for the 6,000 business miles.

Where to Put It on the Tax Form

Schedule C, Line 9

Real World Example

A freelance graphic designer drives 5,000 miles in a year, with 3,000 miles for business meetings and client visits. They choose the standard mileage rate of 65.5 cents per mile (2023 rate), resulting in a deduction of $1,965 (3,000 miles x $0.655).

Calculation Required

A calculation is required for this deduction.

To calculate the deduction using the standard mileage rate, multiply the business miles driven by the IRS mileage rate for the year. If using actual expenses, calculate the total vehicle expenses and multiply by the percentage of business use.

Audit Risk & Documentation Tips

Moderate audit risk. Maintain a detailed mileage log with dates, destinations, and business purposes. Keep receipts for all vehicle expenses if using the actual expense method. Consider using apps or tools to track mileage automatically.

IRS Reference

IRS Publication 463

Relevant Industries

FreelancersConsultantsReal Estate AgentsIndependent Contractors

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Disclaimer: This is for informational purposes only and should not be construed as tax or legal advice. Always consult your tax advisor.

Page created on July 15, 2025

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