# Email from tax consultant: changes mean you can't use the standard mileage deduction for For Hire



## NovaSky (Jun 3, 2018)

Got this in the email:

In the past, the business use of a vehicle was determined either by using the standard mileage rate for business or using actual expenses plus vehicle depreciation limited by the luxury auto caps. That continues to be the case, except the luxury auto depreciation limit has been substantially increased. In addition, there are other changes as detailed below.

Standard Mileage Rates - The standard mileage rates for the business use of a car (or a van, pickup, or panel truck) are:

STANDARD MILEAGE RATES FOR BUSINESS
2017
2018
53.5 Cents Per Mile
54.5 Cents Per Mile

However, the standard mileage rates cannot be used if you have used the actual expense method (using Sec. 179, bonus depreciation and/or MACRS depreciation) in previous years. This rule is applied on a vehicle-by-vehicle basis. *In addition, the business standard mileage rate cannot be used for any vehicle used for hire *or for more than four vehicles simultaneously.

https://www.springparkcpa.com/blog/big-changes-for-vehicle-tax-deductions/43340

Can anyone elaborate on this?


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## NGOwner (Nov 15, 2016)

Unless my google-fu is failing me, that tax consultant is spewing nonsense.

Went to the IRS website and found the Standard Deduction page here.

That IRS page contains a sentence remarkably similar to the one you have in your post, absent your bolded text. The IRS page then links to another document that spells out the restrictions to the use of the Standard Deduction.

That second document (Rev. Proc. 2010-51) spells out in section 4.05(1) that there was a modification that _allows_ the standard deduction to be used in instances of vehicles for hire.

I've found nothing to support the assertion that
a) Rev. Proc. 2010-51 has been superseded by any other document, or
b) we can't use the business standard deduction for rideshare.

So for now, I think we're still good.

[NG]Owner


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## NovaSky (Jun 3, 2018)

NGOwner said:


> Unless my google-fu is failing me, that tax consultant is spewing nonsense.
> 
> Went to the IRS website and found the Standard Deduction page here.
> 
> ...


This looks like it's from 2011?

The guy up there says this is part of the new tax bill.

I'm terrified that my milleage logs will be worthless :-/

Turbotax has the same language.

https://turbotax.intuit.com/tax-tips/small-business-taxes/business-use-of-vehicles/L6hi0zzzh

*Here's a general overview*
Business vehicles are cars, SUVs and pickup trucks that are used for business activities.

What does not qualify:


Vehicles used as equipment, such as dump trucks
*Vehicles used for hire, such as taxi cabs or airport transport vans*


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## Stevie The magic Unicorn (Apr 3, 2018)

When the crap did they do this?

I can't find this on the IRS page at all..

I'm seriously doubting it's validity.

(2) Section 4.05(1) is modified to allow taxpayers to use the business standard mileage rate to calculate the amount of deductions for automobiles used for hire, such as taxi cabs.

This is still on the IRS website... so we still have a defense



NGOwner said:


> Unless my google-fu is failing me, that tax consultant is spewing nonsense.
> 
> Went to the IRS website and found the Standard Deduction page here.
> 
> ...


that's what i'm seeing as well


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## UberTaxPro (Oct 3, 2014)

NovaSky said:


> Got this in the email:
> 
> In the past, the business use of a vehicle was determined either by using the standard mileage rate for business or using actual expenses plus vehicle depreciation limited by the luxury auto caps. That continues to be the case, except the luxury auto depreciation limit has been substantially increased. In addition, there are other changes as detailed below.
> 
> ...


I hope you're not using this "tax consultant"!


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## dauction (Sep 26, 2017)

*Standard Mileage Rate*
Choosing the standard mileage rate and Standard mileage rate not allowed, later.

You generally can use the standard mileage rate whether or not you are reimbursed and whether or not any reimbursement is more or less than the amount figured using the standard mileage rate. See chapter 6 for more information on _reimbursements _.

Choosing the standard mileage rate.

If you want 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 either the standard mileage rate or actual expenses.

If you want to use the standard mileage rate for a car you lease, you must use it for the entire lease period. For leases that began on or before December 31, 1997, the standard mileage rate must be used for the entire portion of the lease period (including renewals) that is after 1997.

You must make the choice to use the standard mileage rate by the due date (including extensions) of your return. You can't revoke the choice. However, in later years, you can switch from the standard mileage rate to the actual expenses method. If you change to the actual expenses method in a later year, but before your car is fully depreciated, you have to estimate the remaining useful life of the car and use straight line depreciation.

Example.

Larry is an employee who occasionally uses his own car for business purposes. He purchased the car in 2015, but he didn't claim any unreimbursed employee expenses on his 2015 tax return. Because Larry didn't use the standard mileage rate the first year the car was available for business use, he can't use the standard mileage rate in 2017 to claim unreimbursed employee business expenses.

For more information about depreciation included in the standard mileage rate, see _Exception_ under _Methods of depreciation_, later.

Standard mileage rate not allowed.

You can't use the standard mileage rate if you:


Use five or more cars at the same time (such as in fleet operations);

Claimed a depreciation deduction for the car using any method other than straight line, for example,MACRS (as discussed later under _Depreciation Deduction_);

Claimed a section 179 deduction (discussed later) on the car;

Claimed the special depreciation allowance on the car;

Claimed actual car expenses after 1997 for a car you leased; or

Are a rural mail carrier who received a qualified reimbursement. (See _Rural mail carriers_ , earlier.)


*Note.*
*You can elect to use the standard mileage rate if you used a car for hire (such as a taxi) unless the standard mileage rate is otherwise not allowed, as discussed above.*


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