# Car Expenses Deductions



## JonnyBoston (Feb 4, 2017)

My understanding is that you can deduct insurance, car loan payments and you cellphone use based on a percentage of how much those are used for your ridesharing. How do you figure out this mysterious percentage? Is there a way to ballpark it? Also can you take the car loan and insurance deductions if you are using mileage deductions?


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

Yes.. well it's an either or situation, not both.

Let's assume my magic unicorn Stevie drove 10,000 miles total and 5,000 miles were business related. (good round easy numbers)

In this case Stevie could deduct 50% of all his vehicle expenses..
Gas, oil changes, insurance, depreciation, (no LOAN PAYMENT) Rental cost. ect

OR
You he could deduct the SRM and deduct $2,675 (based on 5,000 X 53.5c per mile) 


The cell bill is a little more complicated.

Some of these idiot guides suggest keeping a second phone for personal use...

This is absolutely bat Stick fubar crazy.

Any savings from writing off the second phone is lost by paying for a second phone line.

Me personally? I decided not to write off my phone bill.

A lot of people i know write off a portion of their bills. And they get away with it.


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## Older Chauffeur (Oct 16, 2014)

JonnyBoston said:


> My understanding is that you can deduct insurance, car loan payments and you cellphone use based on a percentage of how much those are used for your ridesharing. How do you figure out this mysterious percentage? Is there a way to ballpark it? Also can you take the car loan and insurance deductions if you are using mileage deductions?


You need a mileage log to determine the percentage of business vs personal mileage for the year. Do a similar computation to figure the percentage of your cell phone charges dedicated to business.

You can deduct the business use percentage of only the INTEREST on your car loan, whether you use actual expenses or the SRM. Same holds true for registration/ personal property taxes on your vehicle.

Insurance is deductible only if you're using actual cost method.

Source: IRS Pub 463, page 16 https://www.irs.gov/pub/irs-pdf/p463.pdf

Disclosure: I'm not a tax professional.


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## UberTaxPro (Oct 3, 2014)

JonnyBoston said:


> My understanding is that you can deduct insurance, car loan payments and you cellphone use based on a percentage of how much those are used for your ridesharing. How do you figure out this mysterious percentage? Is there a way to ballpark it? Also can you take the car loan and insurance deductions if you are using mileage deductions?


Car loans aren't deductible, only the interest. Cars are depreciated to recapture the cost. The SMR includes depreciation.


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## UberGeo (Jan 16, 2017)

JonnyBoston said:


> My understanding is that you can deduct insurance, car loan payments and you cellphone use based on a percentage of how much those are used for your ridesharing. How do you figure out this mysterious percentage? Is there a way to ballpark it? Also can you take the car loan and insurance deductions if you are using mileage deductions?


Heard this on radio from wealth builder show...

If you do deduct car loan... If you sell that car, you will have to claim it as profit because you put it into business use. Therefore, you will need to pay taxes on it.


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## UberTaxPro (Oct 3, 2014)

UberGeo said:


> Heard this on radio from wealth builder show...
> 
> If you do deduct car loan... If you sell that car, you will have to claim it as profit because you put it into business use. Therefore, you will need to pay taxes on it.


You can't deduct car loans, instead you depreciate the vehicle. When you sell the vehicle that you depreciated you'll need to recapture the depreciation that you took. This can create a taxable event.


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