Checkmark iconCan I Write This Off?

Is can you write off gas as a business expense a business expense?

TL;DR

Yes, gas can be written off as a business expense if it is used for business purposes, but it must be properly documented and only the business-use portion is deductible.

Detailed Answer

Gas expenses are deductible when they are directly related to business use of a vehicle. This means the vehicle must be used for business activities such as traveling to meet clients, visiting job sites, or transporting goods. Personal use of the vehicle is not deductible. Business owners can choose between deducting actual expenses, which include gas, or using the standard mileage rate set by the IRS. If opting for actual expenses, only the portion attributable to business use is deductible. For example, if a car is used 60% for business, then 60% of the gas expenses can be deducted. It's important to keep detailed records, such as mileage logs and receipts, to substantiate the deduction.

Where to Put It on the Tax Form

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

Real World Example

A freelance graphic designer uses their car to visit clients and attend networking events. They drive 10,000 miles in a year, with 6,000 miles for business purposes. They spend $1,200 on gas annually. They can deduct 60% of their gas expenses, which is $720.

Calculation Required

A calculation is required for this deduction.

To calculate the deductible portion of gas expenses, determine the percentage of total miles driven for business purposes. Multiply this percentage by the total gas expenses. For example, if 60% of total miles are for business, multiply the total gas cost by 0.60.

Audit Risk & Documentation Tips

Moderate audit risk. Keep detailed mileage logs showing the date, destination, purpose, and miles driven for each business trip. Retain all gas receipts and any relevant contracts or client communications that justify the business purpose of the trips.

IRS Reference

IRS Publication 463

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 18, 2025

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