Monday, June 10, 2019

Substantiation of Business Expenses for Vehicles

The IRS requires you to document your business use of your car in order to get a tax deduction through the use of a daily log, expense report, account book, trip sheet, or some other contemporaneous record. I use the tracking function in Quickbooks for my own business mileage. Estimating business auto expenses cannot be used for tax deductions. However if you have a vehicle that qualifies as a nonpersonal use vehicle, then you don't need to track business mileage as the IRS assumes all expenses are tax deductible. A nonpersonal vehicle can be a truck or van that has been modified so that it is unlikely to be used much for personal reasons like only a front bench for seating, shelving filling the cargo area loaded with equipment or merchandise, and with advertising on the side.

No comments:

Post a Comment