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Can you write off can you write off gas as a business expense?

TL;DR

Yes, gas expenses can be deductible as a business expense if they are directly related to business use of a vehicle. However, personal use of the vehicle must be separated from business use, and only the business portion is deductible.

Detailed Answer

Gas expenses are deductible when they are incurred for the business use of a vehicle. This deduction is applicable if you use the actual expense method for vehicle deductions, which requires you to track all vehicle-related expenses, including gas, maintenance, and insurance. Alternatively, you can use the standard mileage rate, which includes gas expenses in its calculation. Personal use of the vehicle is not deductible, so you must maintain records to differentiate between personal and business use. For example, if you drive 10,000 miles in a year and 6,000 of those are for business, you can only deduct 60% of your gas expenses. Note that commuting from home to your regular place of business is considered personal use.

Where to Put It on the Tax Form

Schedule C, Line 9 for car and truck expenses. If using Form 2106 for employee business expenses, report on Line 2.

Real World Example

A freelance graphic designer drives to client meetings and industry events. She keeps a log showing 5,000 business miles out of 8,000 total miles driven in the year. She spends $1,200 on gas. Using the actual expense method, she can deduct $750 (5,000/8,000 * $1,200) for gas expenses.

Calculation Required

A calculation is required for this deduction.

To calculate the deductible portion of gas expenses using the actual expense method, divide the business miles by the total miles driven to find the business use percentage, then multiply this percentage by the total gas expenses.

Audit Risk & Documentation Tips

The audit risk is moderate. To defend this deduction, keep detailed mileage logs showing dates, destinations, and business purposes of trips. Retain all gas receipts and any other vehicle-related expenses. Consider using a mileage tracking app for accuracy.

IRS Reference

IRS Publication 463 (Travel, Entertainment, Gift, and Car Expenses) and IRS Publication 535 (Business Expenses).

Relevant Industries

FreelancersReal Estate AgentsConsultantsDelivery ServicesSales Representatives

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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 25, 2025

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