Can I Write This Off?

Is is gas deductible for self-employed a business expense?

TL;DR

Gas expenses are generally deductible for self-employed individuals as a business expense when used for business purposes, but personal use is not deductible. It's important to distinguish between personal and business use to avoid common misconceptions.

Detailed Answer

Gas expenses are deductible when they are directly related to business activities, such as driving to meet clients, purchasing supplies, or traveling between job sites. However, commuting from home to a regular place of business is not deductible. Self-employed individuals can choose between the actual expense method, which includes gas, or the standard mileage rate method, which accounts for gas and other vehicle-related expenses. For the actual expense method, you must keep detailed records of all vehicle expenses and allocate them between personal and business use. For the standard mileage rate, you simply multiply the business miles driven by the IRS mileage rate. Both methods require keeping a log of business miles driven.

Where to Put It on the Tax Form

Schedule C, Line 9 for car and truck expenses. If using the standard mileage rate, no separate line for gas is needed.

Real World Example

A freelance graphic designer drives 200 miles in a year to meet clients and attend industry events. Using the 2023 standard mileage rate of 65.5 cents per mile, they can deduct $131 (200 miles x $0.655) on their Schedule C.

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 IRS mileage rate (e.g., 200 miles x $0.655). For the actual expense method, calculate the percentage of business use and apply it to the total gas expenses.

Audit Risk & Documentation Tips

Moderate audit risk. Keep a detailed mileage log, including dates, destinations, and business purpose of each trip. Retain all gas receipts and maintain records of total miles driven for the year to substantiate the business-use percentage.

IRS Reference

IRS Publication 463, 'Travel, Gift, and Car Expenses'; IRS Publication 535, 'Business Expenses'; IRS Publication 334, 'Tax Guide for Small Business'.

Relevant Industries

FreelancersReal Estate AgentsConsultantsContractorsDelivery Services

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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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