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Is can you write off fuel on taxes tax deductible?

TL;DR

Fuel expenses can be tax deductible if they are directly related to business use. Personal fuel expenses are not deductible, and proper documentation is crucial to substantiate the business use of fuel.

Detailed Answer

Fuel expenses are deductible when they are incurred for business purposes. For example, if you drive your car for business deliveries or client meetings, the fuel used for those trips can be deducted. However, if you use your vehicle for both personal and business purposes, only the business portion of the fuel expense is deductible. You can choose to deduct actual expenses, which include fuel, or use the standard mileage rate provided by the IRS. It's important to keep detailed records of your mileage and fuel receipts. Non-deductible scenarios include commuting from home to your regular place of work, as this is considered a personal expense.

Where to Put It on the Tax Form

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

Real World Example

A freelance photographer uses their personal vehicle to travel to various photoshoot locations. They track their business mileage and fuel expenses, choosing to deduct the actual fuel costs incurred for these trips. If they spent $500 on fuel for business trips in a year, they can deduct this amount on their Schedule C.

Calculation Required

A calculation is required for this deduction.

To calculate the deductible portion of fuel expenses, track the total business miles driven and divide by the total miles driven during the year to find the business use percentage. Apply this percentage to the total fuel expenses to determine the deductible amount.

Audit Risk & Documentation Tips

Moderate audit risk. Maintain a detailed mileage log, including dates, destinations, purpose of the trip, and miles driven. Keep all fuel receipts and any relevant business records. Consider using a mileage tracking app to ensure accuracy and ease of record-keeping.

IRS Reference

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

Relevant Industries

FreelancersReal Estate AgentsConsultantsDelivery ServicesSales Representatives

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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 25, 2025

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