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New Member
posted Jun 3, 2019 1:04:13 PM

Bought a new vehicle in 2018. 50% business use. Can I write off 50% of the cost of the car?

How much can I write off the first year?

0 5 1607
5 Replies
Level 15
Jun 3, 2019 1:04:14 PM

Are you a W-2 employee or an independent contractor? If you get a W-2 you cannot write off anything about the vehicle.  Job-related expenses for W-2 employees were eliminated by the new tax laws.

Level 9
Jun 3, 2019 1:04:16 PM

Approximately how much did the vehicle cost?
What type of vehicle is it?
Is the vehicle under 6000 pounds, or over 6000 pounds?

Level 15
Jun 3, 2019 1:04:17 PM
New Member
Jun 3, 2019 1:04:18 PM

Part W-2 & Part independent.   It’s under 6000 pounds.

Alumni
Jun 3, 2019 1:04:19 PM

2018 UPDATE with reference to the disallowed deductions in the 2018 TCAJ Tax Act.

Some General Comments on deducting the cost of using/acquisition of your personal motor vehicle weighing under 3T (6,000 lbs.); higher depreciation is available for heavier vehicles:

  1. If you are an employee and use your vehicle for business reasons and are not reimbursed for expense of use, you can no longer deduct any expense -as of 2018  - this limitation from the new tax law proposed by the President and passed by Congress.
    Complaining about this here does nothing.  Please instead contact your Congress person who may have passed this new tax law "TCAJ".

  2. If you are a business owner/operator filing a Schedule C (or other business form), you can write off (deduct) a proportionate amount of the cost, based on the proportion of business use to non-business use.
    1. Leased vehicles are the most effective way of deducting business use because you can deduct a proportionate amount of all or most of the lease cost per year, less an "inclusion amount."
    2. Alternatively, depending on age of the vehicle and the amount of business use, consider using the standard mileage rate of 54.5 cents per mile (2018) - whether leased or purchased.
    3. Purchasing and using depreciation is usually the least effective method as the depreciation schedule limits considerably the amount per year that is deductible.