You will make the selection on the second screen shot below. You may need to go back and delete the initial entries to get to this screen.
There are two
methods of deducting the business use of your vehicle: Standard Mileage rate
and Actual Vehicle expenses. According to the IRS, you must pick one or the
other; you cannot mix the two.
As the name
suggests, the Actual Expenses method requires you to add up all the money
actually spent in the operation of your vehicle. You then multiply this figure
by the percentage of the vehicle’s business use.
The
Standard Mileage method is a much simpler way of calculating the business use
of your car. It does not require you to track individual purchases and save
receipts. Instead, you simply keep track of your mileage for the tax year.
(Tip: Take a photo of your odometer on New Year’s Day and save it, so you can
always see where your mileage stood at the beginning of the tax year.)As with other tax
deductions, you must determine the percentage of your mileage that applies to
your business.
- If half the miles you drive
are for business and half are for personal use, you will multiply your
total mileage by 50% to arrive at the business portion (e.g. 10,000 miles
x .50 business use = 5,000 business miles).
