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Is can you deduct gas as a business expense a business expense?

TL;DR

Gas can be deducted as a business expense if it is used for business purposes, but it must be properly documented and separated from personal use.

Detailed Answer

Gas expenses are deductible when they are directly related to business activities. For instance, if you use your vehicle to meet clients, deliver goods, or travel between job sites, the gas used for these activities can be deducted. However, commuting from home to your regular place of business is not deductible. You can choose to deduct actual expenses (including gas) or use the standard mileage rate, which encompasses gas, maintenance, and other vehicle-related costs. It's important to maintain a log of business miles driven and keep receipts for gas purchases to substantiate the deduction.

Where to Put It on the Tax Form

Schedule C, Line 9 for car and truck expenses, or use Form 2106 for employee business expenses.

Real World Example

A freelance photographer drives 3,000 miles in a year for photo shoots and meetings with clients. They track these miles and choose to deduct the actual gas expenses, which total $600. They keep all gas receipts and a detailed mileage log to support their deduction.

Calculation Required

A calculation is required for this deduction.

To calculate the deduction, you must determine the percentage of business use of your vehicle. For example, if you drive 10,000 miles in total and 3,000 miles are for business, 30% of your gas expenses are deductible. Alternatively, you can use the IRS standard mileage rate for business miles driven.

Audit Risk & Documentation Tips

Moderate audit risk. Keep detailed records, including a mileage log showing dates, destinations, and business purposes of trips. Save all gas receipts and any relevant contracts or client communications. Consider using a mileage tracking app for accuracy and ease.

IRS Reference

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

Relevant Industries

FreelancersReal Estate AgentsConsultantsDelivery ServicesContractors

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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 18, 2025

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