Yes automobile expenses for business use can be taken as a deduction by realtors.
There are two methods of calculating the business use of your car.
The Actual Expenses method
The Actual Expenses method is based on the expenses you actually incur in the operation of your vehicle. It includes things like:
- gas purchases
- oil changes
- tire purchases
- car washes
- insurance
- and even vehicle depreciation.
However, you can only claim the percentage of expenses that apply to the business use of your vehicle.
The second method you can use to compute the business use of your car is called Standard Mileage. You should still track both your personal and business miles but you will only use the business portion to calculate your deduction.
As I understand by your question, you are wondering if you can write off the purchase price of your vehicle as a realtor. For that to be possible,
- The vehicle should be used 50% or more for the business, then you can claim 179 expense deduction or bonus depreciation deduction depending on the vehicle and the limits set by the IRS, under the Actual Expenses method discussed above.
- You can claim the deduction for the business use of the vehicle.
- Keep excellent records of business use of vehicle
Business Use of Vehicles
Maximizing Tax Deductions for the Business Use of Your Car
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