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Level 1

Car lease deductions, mileage, etc.

With my new business I lease a car.


My questions are the following:


Do I set up the car under Business Car or Leased Equipment?


Can I write off miles that are above and beyond commuting? Like when I go on my business trips, or estate sale searches etc...?


Do I write off gas/oil changes?


I have a second car that is mostly family use, but sometimes I have to use it for business as it is bigger and can haul the things I need.

- Do I keep a mileage log for that?

I have been until leasing the new car.


Thank you.


1 Comment 1
Level 15

Car lease deductions, mileage, etc.

Mileage is a tax time election. You track business miles, dates to and from, where and why, as well as the starting ending odometer reading for the tax year. During the year you book the actual expenses of operating the car, fuel, oil changes, tires,etc

Then at tax time you elect to use the standard rate for mileage as an expense or not. If you make that election then you can not include all vehicle related expenses (depreciation,fuel, tires, oil changes, registration, etc etc) too

The lease payment is an expense usually. If the lease is lease to buy, you need to talk to a tax accountant about how to book that aspect

Yes you keep a mileage record for any vehicle you use for business, it should be separate and contain all the data I mentioned for the main one.


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