I work as an Uber Driver but do the majority of my own car repairs. Can parts be tax deductible?

[JT407]

As the title says. I work as an Uber Driver but I do the majority of parts replacement on my own. Are car parts themselves tax deductible? How about tools purchased to make those repairs? The car I use is not in my name so I have to go through the actual expense route. 

Thanks

[MinhT1]

Yes, car parts and tools purchased to repair your vehicle can be deducted. However, you cannot deduct the value of your labor.

[Opus 17 · Accepted solution]

Actual expenses means what it says; actual expenses.  That certainly includes parts that you buy.  (Using the actual expense method with a vehicle that is mixed personal/business use, you still allocate expenses based on mileage.)

Tools is a problem; tools that are expensive and will last more than one year would generally be listed as assets to be depreciated rather than expensed, and car repair tools may not be "ordinary and necessary" expenses for a delivery driver.  And tools you buy that you use business this year, might not be used for business next year.  I think tools (that will go into your personal toolbox for use on all your vehicles) would be difficult to justify if audited and should probably be avoided as expense deductions. 

[JT407]

What would be considered "expensive"? The most expensive tool I had purchased is $40.00.

[Opus 17]

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@JT407 wrote:

What would be considered "expensive"? The most expensive tool I had purchased is $40.00.

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I can't really answer that directly.  No one on this board can give legal advice.  Let me suggest some key points:

1. If audited, you must be able to prove that what you claimed as work expenses were actually for work, and not personal use.
2. You can deduct work expenses that are "ordinary and necessary" for your type of work.  Tools to repair a vehicle may or may not be "ordinary and necessary" for a driver.  (Tools and repair expenses would certainly be ordinary and necessary for a company that had a fleet of delivery vehicles, are you a "fleet of one"?  I can't really advise you on this.  
3. Most people are never audited.
4. It's up to you to decide how much risk to take.  There are two risks involved; will you be audited or not; and if audited, what is your potential exposure?

It's up to you do decide what to do with that information.  

[VolvoGirl]

Here is some IRS reading material……

IRS information on Self Employment

http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Self-Employed-Individuals-Tax-Center

Pulication 334, Tax Guide for Small Business

http://www.irs.gov/pub/irs-pdf/p334.pdf

Publication 535 Business Expenses

http://www.irs.gov/pub/irs-pdf/p535.pdf