If you run a small business, you’ll have many ways to save money at tax time. Here’s what you should know about writing off vehicle use as a tax deduction.
Ella Ames is a freelance writer and editor with a focus on personal finance and small business topics such startups, business financing, and entrepreneurship. She has a background in business journalism and her work has appeared not only on The Balance, but LendingTree, ValuePenguin, EE Times, PolicyMe, AllBusiness.com, and more.
David Kindness is a Certified Public Accountant (CPA) and an expert in the fields of financial accounting, corporate and individual tax planning and preparation, and investing and retirement planning. David has helped thousands of clients improve their accounting and financial systems, create budgets, and minimize their taxes.
David J. Rubin is a fact checker for The Balance with more than 30 years in editing and publishing. The majority of his experience lies within the legal and financial spaces. At legal publisher Matthew Bender & Co./LexisNexis, he was a manager of R&D, programmer analyst, and senior copy editor.
If you use a vehicle as part of your business operations, such as to deliver products or drive to worksites, your company may be eligible for certain tax deductions. But there are a few important details to consider so you know what you can include, when you can do it, and how to write off these expenses.
You may qualify to deduct some of your vehicle-related expenses if you use your car for business purposes. The IRS defines a car as any four-wheeled vehicle—including a truck or van—intended for use on public streets, roads, and highways. It mustn't exceed 6,000 pounds in unloaded gross weight. Exceptions include ambulances, hearses, vehicles used to transport people or property for money or hire, or trucks or vans that are qualified nonpersonal use vehicles.