Can I Write This Off?

Is can i write off gas and mileage tax deductible?

TL;DR

Gas and mileage can be tax deductible if they are incurred for business purposes. However, you must choose between the standard mileage rate or actual expenses method, and you cannot deduct both for the same vehicle.

Detailed Answer

To deduct gas and mileage, the expenses must be directly related to business activities. You can choose between two methods: the standard mileage rate, which simplifies the process by allowing a deduction based on miles driven (58.5 cents per mile for the first half of 2023, and 65.5 cents per mile for the second half), or the actual expenses method, which involves calculating the business portion of all vehicle-related expenses, including gas, maintenance, and insurance. Personal commuting is not deductible. For example, a real estate agent driving to showings can deduct these expenses, but not for driving from home to the office. The choice of method should be consistent throughout the tax year.

Where to Put It on the Tax Form

Schedule C, Line 9 for car and truck expenses. If using Form 2106, report on Line 1.

Real World Example

A freelance graphic designer drives 5,000 miles in 2023 for client meetings and project site visits. Using the standard mileage rate for the second half of 2023, they can deduct $3,275 (5,000 miles x $0.655).

Calculation Required

A calculation is required for this deduction.

To calculate the deduction using the standard mileage rate, multiply the total business miles driven by the applicable IRS mileage rate. For actual expenses, calculate the percentage of business use and apply it to total vehicle expenses.

Audit Risk & Documentation Tips

Moderate audit risk. Maintain a detailed mileage log with dates, destinations, purpose of trips, and miles driven. Keep receipts for gas and maintenance if using the actual expenses method. Consistency and thorough documentation are key to defending this deduction.

IRS Reference

IRS Pub 463, Travel, Gift, and Car Expenses; IRS Pub 535, Business Expenses.

Relevant Industries

FreelancersReal Estate AgentsConsultantsSales RepresentativesContractors

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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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