# Std. Mileage if I don't own car? What does "LEASE" mean?



## Trafficat (Dec 19, 2016)

So I'm looking at the IRS website (I can't post a link per forum rules).

It says to claim a std. Mileage deduction, I must "own or lease" the vehicle. Does anyone know what "lease" entails? I'd really love to claim a standard mileage deduction. I've been meticulously tracking odometer readings for the vehicles when I use them.

Right now I'm fresh outa college with a useless degree so I drive for Uber. I don't personally own a car, but I've had an informal arrangement with my parents that I pay them $300 a month and then I can use any of their cars. 

I'm on the insurance plan etc., but my name does not appear on the registration or title for the vehicles. Uber had no problem approving me to drive these cars. My parents don't claim any deductions on the vehicles.

Do you think there is any chance that my informal arrangement would count as a "lease" or does "lease" have a more formal meaning? Do I need my name on the vehicle registration to claim a std. mileage deduction?

One of the cars is pretty much exclusively my own. I pay out of pocket for gas, maintenance, etc, and I put the most Uber miles on this one. 

The other is a 4 wheel drive vehicle for bad weather conditions and don't drive it that much. Pretty much my contribution is in that $300 plus an occasional fill-up at the gas station.

Any thoughts? I guess next year I could try "owning" a car, but for 2016 it seems I might have made unwise choices.


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## Trafficat (Dec 19, 2016)

Googling it, it appears I am probably ineligible for a standard mileage deduction since depreciation is factored into standard mileage and only an owner can have depreciation. And to make things worse, I cannot claim actual expenses either because if I do it will mean that I cannot use standard mileage deduction in the future if I get the title transferred to my name, as it appears that the IRS has a rule that you must use standard mileage in the "first year" a vehicle is available if you ever want to use it again.

So basically, it seems if you're going to do rideshare, owning the car is a must. The only reason I don't have the title in my name for my main car is that it is such an inconvenience to go to the DMV to do it and I could not persuade the title holders it was worth the effort. Now I can probably persuade them after my research.

However, one question I'm still trying to find out is if the title holder could deduct my miles from their taxes. I am going to guess the answer here is "no" also since it is my business and not theirs. Using someone else's car while paying for every aspect of it seems to be a lose-lose proposition. All of the expenses, none of the deductions.


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## Trafficat (Dec 19, 2016)

And another question is, if I get "added" to the title next year as a co-owner, can I claim a full mileage deduction or do I only get a fraction? Do I need to be the sole owner of the vehicle to claim a mileage deduction?


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## samuraikitty (Nov 23, 2016)

I'm interested in the answers to this as well as I plan on co-owning a car with my parents to use for rideshare.


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## Mars Troll Number 4 (Oct 30, 2015)

If i'm understanding this correctly..

The car is not in your name?
Your in possession of it?
You are insured to drive it?

This is entirely a mess that you yourself have created by starting this without first looking into the tax implications of doing what you are doing.

Normally a driver has their expenses covered in one of three ways.

A: one either owns their car outright
(you wouldn't be in this mess)

B: it's owned by the company they are an employee of and they paid a wage while driving.
(the company would be footing the bill for the use of the vehicle)

C: they are in a short term lease of the vehicle and pay a fee to use it.
(You can write off your actual expenses, IE i write off the amount i pay the taxi company, or what someone pays Breeze, or Uber Exchange, Or enterprise leasing for using the vehicle as an actual expense)


What you needed to do was get the title transferred to you BEFORE you started driving for uber.


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## elelegido (Sep 24, 2014)

Trafficat said:


> Googling it, it appears I am probably ineligible for a standard mileage deduction since depreciation is factored into standard mileage and only an owner can have depreciation. And to make things worse, I cannot claim actual expenses either because if I do it will mean that I cannot use standard mileage deduction in the future if I get the title transferred to my name, as it appears that the IRS has a rule that you must use standard mileage in the "first year" a vehicle is available if you ever want to use it again.
> 
> So basically, it seems if you're going to do rideshare, owning the car is a must. The only reason I don't have the title in my name for my main car is that it is such an inconvenience to go to the DMV to do it and I could not persuade the title holders it was worth the effort. Now I can probably persuade them after my research.
> 
> However, one question I'm still trying to find out is if the title holder could deduct my miles from their taxes. I am going to guess the answer here is "no" also since it is my business and not theirs. Using someone else's car while paying for every aspect of it seems to be a lose-lose proposition. All of the expenses, none of the deductions.


Just decline to pay income tax; as Trump says, it would only be squandered.


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## Mars Troll Number 4 (Oct 30, 2015)

samuraikitty said:


> I'm interested in the answers to this as well as I plan on co-owning a car with my parents to use for rideshare.


_https://www.irs.gov/taxtopics/tc510.html_

_
*Standard Mileage Rate -* For the current standard mileage rate, refer to Publication 463, Travel, Entertainment, Gift, and Car Expenses, or search standard mileage rates on IRS.gov. To use the standard mileage rate, *you must own or lease the car and:*

_

_You must not operate five or more cars at the same time, as in a fleet operation,_
_You must not have claimed a depreciation deduction for the car using any method other than straight-line,_
_You must not have claimed a Section 179 deduction on the car,_
_You must not have claimed the special depreciation allowance on the car,_
_You must not have claimed actual expenses after 1997 for a car you lease, and_
_You cannot be a rural mail carrier who received a "qualified reimbursement."_
_

To use the standard mileage rate for a car you own, you must choose to use it in the first year the car is available for use in your business. Then, in later years, you can choose to use the standard mileage rate or actual expenses._

As far as I know... the vehicle MUST BE IN YOUR NAME OR LEASED IN YOUR NAME.


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## Older Chauffeur (Oct 16, 2014)

Trafficat said:


> So I'm looking at the IRS website (I can't post a link per forum rules).
> 
> It says to claim a std. Mileage deduction, I must "own or lease" the vehicle. Does anyone know what "lease" entails? I'd really love to claim a standard mileage deduction. I've been meticulously tracking odometer readings for the vehicles when I use them.
> 
> ...


Disclosure: I'm not a tax professional.
But common sense suggests to me that if you treat this situation as though your name was on the title, it will not be a problem. If you have a contemporaneous mileage log based on tracking the business mileage, you can prove in an audit that there was deductible business use of the vehicle. I would immediately get your name added to the title, but I think the odds of you being audited are fairly slim, and the auditor asking to see who the car is registered to even slimmer. If asked, you would have it to show you as an owner.
One thing you may need to consider is the insurance your parents have. Is the company aware of your rideshare activity? Do they offer a rider to cover the gap? I realize this is unrelated to your tax question, but could be important. Good luck to you.


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