Tax deductible season is here again! For a lot of people, tax season is linked to financial related stress and anxiety. Luckily, for those who are looking into or have already bought a car, there are some secrets Auto Action has for tax deductible expenses related to your vehicle, especially if you have your own small business (even business you may not expect like a landscaping company, housekeeping services, construction, etc.) Here are 5 tax deductions you may be eligible for.
State Sales Tax
If you own a small business, you have the choice of deducting state sales tax or state income tax from the return for the large portion of state sales tax you had to pay when you purchased your vehicle. Depending on your business, you may be able to deduct a significantly larger amount.
Title and Registration Fees
As long as your vehicle is used exclusively for business purposes, you are eligible to deduct all the title and registration expenses you had to pay to the state upon the purchase of your car. In some cases, if the car is used on a personal basis as well as a business basis, you are still eligible to save on title and registration tax deductions for the business usage, but this takes a lot of documenting throughout the entire year.
Whatever fuel expenses you have in order to keep your business up and running can be a deductible. Fuel costs are in a subset of “actual expenses” for tax deductible expenses on your vehicle. “Actual expenses” is the same category that your insurance expenses fall.
Maintenance & Repair Costs
Along with fuel costs, “actual expenses” also holds any maintenance and repair costs that your vehicle undergoes. You are able to deduct from these expenses, as your car may have gone through some wear and tear while servicing your business than it would have if you were only using it as a personal vehicle.
Mileage in Certain Situations
Although not quite an “actual expense” wear and tear, any business-related miles added up may be deductible. In addition, if you use your car for any sort of charity work or donatable causes, you can also get deductibles off that that. Expert consultants are the best professionals to confide in when it comes to knowing for sure if you can save on mileage expenses on your tax return. Do your research before doing your taxes.
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