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Is can you deduct gas and mileage tax deductible?

TL;DR

Gas and mileage can be deductible if they are incurred for business purposes.

Detailed Answer

You can deduct either actual vehicle expenses, including gas, or use the standard mileage rate for business travel. The standard mileage rate is often simpler and covers all vehicle-related expenses. Personal commuting and personal use of a vehicle are not deductible. For example, if you use your car to visit clients or travel to a temporary work location, these miles can be deducted.

Where to Put It on the Tax Form

Schedule C (Form 1040) for sole proprietors, or Form 2106 for employees if reimbursed by employer.

Real World Example

A freelance graphic designer drives 100 miles to meet with a client. They can deduct these miles using the standard mileage rate or actual expenses if they keep detailed records.

Calculation Required

A calculation is required for this deduction.

To calculate the deduction using the standard mileage rate, multiply the number of business miles driven by the IRS standard mileage rate for the year. For actual expenses, add up all vehicle-related costs and multiply by the percentage of business use.

Audit Risk & Documentation Tips

Keep a detailed mileage log showing dates, miles driven, and purpose of each trip. Retain receipts for gas and maintenance if using actual expenses. Accurate records are crucial to substantiate your deduction in case of an audit.

IRS Reference

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

Relevant Industries

FreelancersSmall BusinessSales ProfessionalsReal Estate Agents

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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