If you use your vehicle for business, you may be eligible to deduct your vehicle expenses. When it comes to vehicle expenses, the IRS only allows you to use one deduction method: the standard mileage rate or actual vehicle expenses (i.e. repairs, gas, maintenance, etc). Most Hurdlr users track both their vehicle expenses and mileage in Hurdlr because Hurdlr is smart enough to not deduct both when calculating your tax estimates. This way, you can choose the method that is most advantageous for you.
Can I deduct my car payment?
If you own your vehicle (and finance it), then you should be eligible to deduct the business portion of your interest payment as a business expense. However, you can't typically deduct the loan principal amount as a business expense.
Can I deduct my lease payment?
If you lease your vehicle, you can deduct the business portion of your vehicle lease.
Comparing Your Deduction
You can switch between deduction methods to see which will save you more. To do so, follow these steps:
On the Mobile App
On the Mobile App
Navigate to the Taxes tab
Tap the gear icon in the top right corner
Change ‘Use Mileage Deduction’ to Yes (if you want to see your tax estimates with the standard mileage rate) or No (if you want to see your tax estimates with your actual vehicle expenses)
Tap ‘Save’
On the Web App
On the Web App
Click the gear icon in the top right corner
Select ‘Tax Profile’
Change ‘Use Mileage Deduction’, to Yes (if you want to see your tax estimates with the standard mileage rate) or No (if you want to see your tax estimates with your actual vehicle expenses)
Click ‘Save’
Disclaimer: The information contained here is provided for informational purposes only and should not be construed as financial or tax advice. It is not intended to be a substitute for obtaining accounting or other financial advice from an appropriate financial adviser or for the purpose of avoiding U.S. Federal, state or local tax payments and penalties.