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Bought new car in 2016 for business. Turbo Tax recommended actual expenses deduction of $11,909, but software uses std. mileage rate of $3623, not actual expenses.

I bought a new car in Jan. 2016 and I use it conducting business for our rental properties.  Turbo tax recommended using actual expenses giving me a deduction of $11,909, with total vehicle deduction of $12,611.  I chose using actual expenses and yet Turbo Tax entered the standard mileage rate of $3623.  Vehicle is used more than 50% in business.  Why am I being forced to use the standard mileage rate when Turbo Tax recommends using actual expenses?  How do I override Turbo Tax so I can use the actual expenses?


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MichaelDC
New Member

Bought new car in 2016 for business. Turbo Tax recommended actual expenses deduction of $11,909, but software uses std. mileage rate of $3623, not actual expenses.

Try this to resolve a forced standard mileage deduction in TurboTax. Please let me know in the comment section.

From the Business topic heading, click "update" for Business Income and Expenses (little red briefcase icon)

  • On the screen entitled "Here's the business info we have so far", click "Edit" for your business and continue through the interview until you get to the screen entitled "Your ~ Business", where you can scroll down to the topic heading for "Business Vehicle Expense" where you can click "update"
  • On the screen entitled "Vehicle Summary" click "Edit" for the vehicle for which we need to fix the entries
  • Continue through the interview until you get to a screen entitled "You've Got a Standard Mileage Deduction of $x" and answer the "Do You want to see if your actual vehicle expenses give you a bigger deduction?" screen  
    • When answering this question, consider that if in the first year that you used your vehicle in your business, you had elected actual costs including depreciation on your vehicle, then the IRS won't let you can't switch to the standard mileage deduction in a later year.
    • If business use of the vehicle falls below 50% after the first year, then the IRS dictates that your election to use actual expenses ends, so the program must recapture the benefit of any depreciation you took previously.
    • Line 24 b is a check box to force the standard mileage for your business use vehicle on the Car and Truck Worksheet that is linked to your Schedule C.  
  • If you are in the smart check/error check, the white box beneath the writing at the top of the page is where TurboTax expects you to type (not in the body of the tiny form with the little scroll bar on the right that populates the screen).

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