In this episode of ‘Dr. Friday Tax Tips – One Minute Moment,’ Dr. Friday delves into the intricacies of deducting business use of a car, comparing the mileage deduction to actual expenses. Covering the essentials of Section 179, fuel, insurance, and other costs associated with maintaining a vehicle for business purposes, she provides a detailed explanation on calculating deductions based on the percentage of business use. A critical highlight is the caution against purchasing vehicles over 6,000 pounds for non-essential business needs, specifically targeting professionals in accounting. This insightful segment is a must-listen for anyone considering the best method to deduct their business vehicle expenses.
Transcript: G’day, I’m Dr. Friday, president of Dr. Friday’s Tax and Financial firm. To get more info, go to www.drfriday.com. This is a one-minute moment.
Business use of car, miles or actual? We’ve covered miles in the last number of, if you’ve been listening to my one minute moments we’ve covered all of those. What is actual deduction for a vehicle? So that’s when we get into section 179, that’s when we get into actual fuel, get into your insurance, all the cost it takes to keep that car. And you’re going to do it based on a percentage of usage, unless of course you use it 100%. What I have to warn you about is if you go out and buy yourself over a 6,000 pound truck and you do accounting, you better make sure that truck is justified because an accountant doesn’t need it.
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