Just Bought A New Car: Can I Write Part Of It Off?

[legomom922]

Not a new car but a used, 2003 SUV. Can I claim any of it since now I have a new car loan & interest?

[TomCopeland]

Carpet

You are always entitled to claim the business portion of car loan interest no matter which method you use to claim car expenses.

If you use the standard mileage rate you can deduct $.51 a business mile, plus parking, car loan interest, and tolls.

If you use the actual car expenses method you can claim the business portion of all car expenses. You can also depreciate the cost of the car. You can't deduct a portion of the car loan payment because this is covered when you take car loan interest and depreciation.

[legomom922]

You are always entitled to claim the business portion of car loan interest no matter which method you use to claim car expenses.

If you use the standard mileage rate you can deduct $.51 a business mile, plus parking, car loan interest, and tolls.

If you use the actual car expenses method you can claim the business portion of all car expenses. You can also depreciate the cost of the car. You can't deduct a portion of the car loan payment because this is covered when you take car loan interest and depreciation.

So is there a preferred way? Which way would a DCP make out better? Method 1 or 2? I am assuming method 2 is alot more involved, and you muct keep track of everything? Exact miles, gas purchases, etc..

[TomCopeland]

Car

In general, most providers will probably get a higher deduction if they use the actual expenses method, rather than the standard mileage method. But it's a lot more work. That's why most providers use the standard mileage method.