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Can you write off is gas a business expense?

TL;DR

Gas can be a deductible business expense if it is used for business purposes. Personal use of gas is not deductible, and proper documentation is essential to substantiate the business use.

Detailed Answer

Gas expenses are deductible when they are directly related to the operation of a business vehicle used for business purposes. This includes travel to meet clients, attend business meetings, or transport goods. However, commuting from home to a regular place of business is not deductible. If a vehicle is used for both personal and business purposes, only the portion of gas used for business can be deducted. Taxpayers can choose between deducting actual expenses (including gas) or using the standard mileage rate, which covers gas, maintenance, and other vehicle-related costs. For example, if a consultant drives 10,000 miles in a year and 6,000 of those miles are for business, they can deduct 60% of their gas expenses if using the actual expense method.

Where to Put It on the Tax Form

Schedule C, Line 9 (Car and truck expenses). If using Form 2106, report on Line 2.

Real World Example

A freelance graphic designer uses their car to visit clients and attend networking events. They drive 12,000 miles in a year, with 7,200 miles for business. They choose to deduct actual expenses and spend $2,400 on gas. They can deduct $1,440 (60% of $2,400) as a business expense.

Calculation Required

A calculation is required for this deduction.

To calculate the deductible portion of gas expenses, determine the percentage of total miles driven for business purposes. Multiply this percentage by the total gas expenses. For example, if 60% of total miles are for business, multiply total gas expenses by 0.60.

Audit Risk & Documentation Tips

Moderate audit risk. Taxpayers should keep detailed mileage logs, including dates, destinations, and business purposes of trips. Retain gas receipts and any maintenance records. Consider using apps or tools to track mileage and expenses accurately.

IRS Reference

IRS Publication 463 (Travel, Gift, and Car Expenses)

Relevant Industries

FreelancersReal Estate AgentsConsultantsSales ProfessionalsDelivery Services

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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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