Can I deduct my mileage for work if I receive $650/month as an auto allowance but it is taxed as income and the company pays for gas?

[Vanessa · Accepted solution]

Yes, IF it is included in your box 1 wages on your W-2 you can take the mileage deduction as you are paying taxes on the income. 

If it is not included in your box 1 wages, then you would still be able to enter the mileage, but you would need to report your reimbursement for your expenses.

To do the later, you will enter your vehicle mileage expenses under job expenses and then if you continue through you will see a question that says "Reimbursements for your expenses"  Click yes and then continue and it will allow you to enter the amount you were reimbursed.  The steps are below:

1. Click on Federal Taxes
2. Deductions and Credits
3. Scroll down to Employment Expenses click Show More
4. Click Start next to Job Expenses for W-2 Income
5. continue through to answer the questions after you enter the mileage and it will take you to the question to enter reimbursements.

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