510 -

You can generally choose between two primary methods to calculate your deductible car expenses:

: Use Form 2106 (or 2106-EZ) and itemize on Schedule A. Self-Employed : Deduct expenses on Schedule C (Form 1040). Farmers : Use Schedule F (Form 1040). You can generally choose between two primary methods

: You track the actual cost of operating the car. This includes gas, oil, repairs, tires, insurance, and registration fees. 🛠️ Key Rules and Limitations : You track the actual cost of operating the car

For more detailed guidance, refer to IRS Publication 463 regarding travel and car expenses. : You multiply the business miles driven by a set IRS rate

: You multiply the business miles driven by a set IRS rate. This requires you to choose this method in the first year the car is available for business use.

: You must maintain adequate records or evidence to support your statement of expenses.

: There are specific limits on how much depreciation you can deduct each year, which vary based on the vehicle's weight and use percentage.