Chapter 43 Deducting Car and Truck Expenses

The costs of buying and operating a car, truck, or van for business are deductible under rules hedged with restrictions. Depreciation deductions for most cars, trucks, and vans are subject to annual ceilings. For new cars placed in service in 2017 that are used over 50% for business, the first-year depreciation limit is $11,160 (43.4). For most new light trucks and vans, the 2017 limit is $11,560 (43.4). The annual limits are reduced for personal use. If a vehicle placed in service in 2017 is used 50% or less for business, depreciation must be based on the straight-line method and the maximum deduction is reduced by personal use (43.4).

To avoid accounting for actual vehicle expenses and depreciation, you may claim an IRS mileage allowance. The allowance for 2017 is 53.5 cents per mile. Keep a record of business trip mileage.

If you are self-employed, you deduct ...

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