You didn’t buy that company vehicle just to look good in the drive-thru line. You got it because your business needed wheels, and maybe a little street cred.
But what if that vehicle could do more than haul tools, supplies, or your behind to a meeting?
What if it could help lower your tax bill?
Yep, that’s real. And no, it’s not a loophole. It’s the law. The IRS lets you deduct the cost of business vehicle use… if you follow a few simple rules.
Start with This: Who Owns the Vehicle?
If your business owns the vehicle (as in, it’s titled to the business), good news. You can likely deduct:
- Depreciation – The vehicle loses value each year, and that loss can reduce your taxes.
- Fuel, maintenance, insurance – If it’s used for business, it counts.
- Interest on a vehicle loan – If the business is paying the note, that interest could be deductible too.
But even if it’s in your personal name, there’s still a way to win.
What If It’s Your Car?
You can still deduct business mileage using the standard mileage rate. Through 2024 it was 67 cents per mile. But starting January 1, 2025, it’s up to 70 cents per mile.
So if you drive 10,000 business miles this year? That’s a $7,000 deduction.
Not bad for something you’re already doing.
One Rule: Keep It Legit
To stay on the IRS’s good side, track your business miles. No, not on sticky notes in your cupholder. Use an app like MileIQ, Everlance, or even the notes app on your phone.
Just jot down:
- Where you went
- Why it was for business
- How many miles
That’s it. Doesn’t need to be fancy, just consistent.
Don’t Miss This Bonus: Section 179
Buy a new or used vehicle for the business this year? You might be able to write off the whole thing in Year One under Section 179.
Big caveat: This only works for certain vehicles (usually over 6,000 pounds gross vehicle weight). Think trucks, vans, and SUVs… not your Prius.
Ask us first before you try this. The rules are helpful but picky.
We help business owners turn everyday expenses into tax-smart moves. If you’re not sure whether your ride qualifies, or if you want to make sure you’re not leaving money on the table, let’s talk.
Just don’t ask us to sort your glove box.
