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Is can i deduct gas from taxes a business expense?

TL;DR

Gas expenses can be deductible as a business expense if they are directly related to business use of a vehicle. It's important to differentiate between personal and business use.

Detailed Answer

Gas expenses are deductible when they are incurred for business purposes, such as driving to meet clients, purchasing supplies, or traveling between job sites. Personal commuting costs are not deductible. Business owners can choose between deducting actual expenses, including gas, or using the standard mileage rate, which covers all vehicle-related costs. For example, a real estate agent driving to showings can deduct gas expenses if they track mileage and separate personal use. However, driving from home to a regular office is considered commuting and is not deductible.

Where to Put It on the Tax Form

Schedule C, Line 9 for car and truck expenses if using actual expenses, or Line 44 if using Form 4562 for depreciation and Section 179 expenses.

Real World Example

A freelance graphic designer uses their car to visit clients and attend networking events. They track their mileage and gas receipts, totaling $1,200 for the year. They can deduct this amount as a business expense on their Schedule C, provided they maintain proper documentation.

Calculation Required

A calculation is required for this deduction.

To calculate the deduction, the taxpayer must determine the percentage of business use of the vehicle. This involves tracking total miles driven and business miles driven. The deduction can be calculated by multiplying the total gas expenses by the business-use percentage.

Audit Risk & Documentation Tips

Moderate audit risk. Taxpayers should keep a detailed mileage log, including dates, destinations, and business purposes. Save all gas receipts and maintain a calendar of business activities to substantiate the deduction.

IRS Reference

IRS Publication 463, Travel, Gift, and Car Expenses; IRC §162.

Relevant Industries

FreelancersReal Estate AgentsConsultantsContractors

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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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