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Vehicle purchase for work use

I recently purchased a vehicle to be used 95% as a rideshare driver. Is the vehicle purchase price deductible? What else can I deduct regarding the vehicle?

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1 Reply
dev145
Employee Tax Expert

Vehicle purchase for work use

Hello transitions210,

 

Yes, if you used personal vehicle for business, you can claim certain expenses. IRS has two separate methods to claim vehicle use. 1. Standard Mileage - You get a fix amount (set by IRS each year) for each mile drove for business purpose. 2. Actual expense  - you deduct gas, repairs, insurance, depreciation etc. expenses for business use. With actual expense, you can deduct purchase price ( amt. will depend on business use %). There is something called section 179 deduction and bonus depreciation that you can use to deduct vehicle if you qualify. Please note, if business use drops below 50% or if you sell the vehicle, you will have to recapture special and bonus depreciation taken in prior years. See below links for more info. about these topics. 

https://www.irs.gov/publications/p946

https://www.irs.gov/taxtopics/tc510

https://www.irs.gov/faqs/sale-or-trade-of-business-depreciation-rentals/depreciation-recapture/depre...

https://turbotax.intuit.com/tax-tips/rental-property/depreciation-recapture-definition-calculation-a...

 

 Thanks for participating in TurboTax's Ask the Expert event today. I hope this information was helpful!

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