LLC members are eligible to claim many deductions that are associated with their participation in an LLC. Personal use of a vehicle is not a deductible expense. However, use of a personal vehicle for a business purpose with respect to the LLC is a deductible expense provided certain requirements are met. There are two methods by which you can deduct mileage for the business use of your personal vehicle, and they mirror the methods used to deduct vehicle expenses for other business purposes beyond LLC-related use.
Itemize your deductions on Form 1040 in order to claim the mileage deduction on your taxes. This means that you will not be able to take the standard deduction.
Claim the mileage deduction on Schedule C of Form 1040.
Enter the amount you are deducting on line 9. For the standard mileage rate, take the total number of miles driven for business purposes and multiply that by the standard mileage rate (which is 51 cents for 2011). The result will be your deductible amount. If you’re using the actual expenses method rather than the standard mileage rate, you will total your actual vehicle expenses for the tax year, and enter on Schedule C the percentage of that total that can be attributed to LLC business use of your personal vehicle.
Tips
Ensure that you have substantiated the business use of your car properly, in case you are audited. For either method, you should keep a log of business miles driven in your car that includes the dates, miles driven and purpose of the trip. If you use the actual car expenses method, you should also include and note the instances of your personal car use.
References
- IRS: Form 1040 Schedule C Instructions (2010)
- Internal Revenue Service. "IRS issues standard mileage rates for 2020." Accessed Feb. 3, 2020.
- Internal Revenue Service. "Standard Mileage Rates." Accessed Feb. 3, 2020.
- Cision PR Newswire. "Runzheimer Data Sets 2017 IRS Business Mileage Rate at 53.5 Cents." Accessed Feb. 3, 2020.
- U.S. Government Publishing Office. "H. R. 606." Accessed May 1, 2020.
- Internal Revenue Service. "Publication 463 Travel, Gift, and Car Expenses," Pages 13-15. Accessed Feb. 3, 2020.
- Internal Revenue Service. "Publication 526 Charitable Contributions," Page 6. Accessed Feb. 3, 2020.
Tips
- Ensure that you have substantiated the business use of your car properly, in case you are audited. For either method, you should keep a log of business miles driven in your car that includes the dates, miles driven and purpose of the trip. If you use the actual car expenses method, you should also include and note the instances of your personal car use.
Writer Bio
Kay Lee began freelance writing for Answerbag and eHow in 2010. She is an attorney in Washington, DC, practicing since 2006. Lee specializes in employee benefits and executive compensation. She holds a Juris Doctor from the Columbus School of Law and a Master of Laws from Georgetown University Law Center.