Zeta - The following are general comments, not tax advice. For tax advice, consult IRS.gov or an enrolled agent.
You have two options on every car you put in service, and you must select the option the year you put it in service. You can choose to deduct the IRS allowed business mileage allowance, or you can choose to deduct actual expenses, including depreciation, applicable to your business mileage.
You cannot deduct the cost of a car. You can depreciate a car over several years, and deduct the business part of the depreciation. The percentage of the depreciation you can deduct annually will depend on the number of personal miles and the number of business miles.
If you elect to depreciate the car, you can deduct your actual operating expenses applicable to the miles you drive the car for business. You cannot deduct the mileage allowance if you depreciate the car. You must choose the first year you put the car in service as to whether you will claim XX cents per mile allowed by IRS for business mileage, or whether you will depreciate, deduct the business percentage of the depreciation, and deduct actual expenses incurred for business mileage.
Mary Davis Nowell. Based close to Fort Worth. Shopping Interstate 20 east and west, Interstate 35 north and south.
