Yes, you would have two deductions for the same vehicle. If you entered the same vehicle and the same total business miles in your self employment activity and again in the rental activity then you would have two separate deductions using the standard mileage rate. Be sure you entered only the business miles in the self employment section and then only the rental mileage in the rental activity. Based on your question it appears you are using the standard mileage rate and that's a good way to do it.
The following information will be very important if you ever trade (considered a sale for income tax purposes) or sell out right this vehicle. At that time you will have a taxable event due to the allowable deductions on your tax return.
- The way to know the business versus personal use of a vehicle is the mileage, i.e., business miles divided by total miles. The IRS important questions about vehicles is 'Do you have evidence?' and 'Is it written?'
- A mileage log is very important when it comes to taking deductions for a vehicle for business and for rental activity. You can 'back track' to create a written record so that you have it. It can be as simple as writing the business or rental miles on a calendar and then your oil changes or other repair will help you figure out the total miles on your vehicle for the year. You can also include the beginning and ending odometer on your business calendar.
Please update here if you need further assistance and one of our tax experts will help.
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