gma1013-
New Member

Mileage for work

Can I deduct my lease expense if my employer pays my mileage?
MichaelDC
New Member

Deductions & credits

Yes. It's possible for you to claim your gas, tires, brakes and "wear and tear" on your car even after reimbursement. However, it may or may not be helpful depending on a number of factors. TurboTax will ask you all the questions to determine if it helps you.

You can enter the business expenses here:

·         Go to Federal Taxes,

·         Click Deductions and Credits, 

·         Select I'll choose what I work on 

·         Select Job-Related Expenses under Employment Expenses.

·         Select Yes to the Did you have any of these expenses in 2016 for your W-2 income?

·         Follow along the interview and select Actual Expenses

Enter ALL business miles driven and vehicle information first in the interview questions. Then, it will ask for reimbursement information.

Here's some more info about the strategy you may find helpful:

This would involve deducting actual expenses for your vehicle, then subtracting the reimbursement of your standard mileage.

Here are some of the items you can include in your deduction:

·         A portion of your lease payment (if you are leasing your vehicle)

·         Auto loan interest (if you’re financing the purchase of your vehicle)

·         Auto Insurance

·         Maintenance and Repairs (like oil changes, new tires, replacing brake pads, etc.)

·         Depreciation

Example You drove 10,000 miles in the year 2016, and 5,000 of those miles were for business. Here’s how you would break down your deductions using the Actual Expenses method:

·         Gas: $1,000

·         Insurance: $1,500

·         Repairs: $400

·         Lease Payments: $6,000

·         Oil: $100

·         Car Wash: $500

These figures total to $9,500 in car-related expenses. Since you used your car for business purposes 50% of the time, you would multiply your total expenses by 50% to get your actual deduction, which comes out to $4,750.

If you use these same figures to calculate your reimbursement using the Standard Mileage method, you would multiply your business mileage (5,000 miles) by the standard mileage rate (54 cents per mile), which comes out to $2,700.

This would leave you with a net deduction of $2,050 ($4,750-$2,700) by using the Actual Expenses method for the deduction.

Of course, your mileage may vary, but TurboTax will allow you to easily determine whether this is a good strategy for you.



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