Vehicle & Mileage Deduction

Average Value: $3,000 - $15,000+

The vehicle deduction covers business use of your car. You can choose the IRS standard mileage rate (72.5¢/mile in 2026, 70¢ in 2025) or deduct actual expenses (gas, insurance, repairs, depreciation) proportionally. This is one of the largest deductions for many self-employed professionals.

Requirements

Vehicle must be used for business purposes
Commuting from home to regular workplace doesn't count
Must maintain a contemporaneous mileage log
Standard rate requires using it in car's first year of business use

How to Claim

1Track every business trip with date, destination, purpose, miles
2Calculate total business miles for the year
3Standard method: Miles × IRS rate (72.5¢/mile 2026)
4Actual method: Track all vehicle expenses, multiply by business %
5Report on Schedule C Part II or Form 4562

Common Mistakes to Avoid

✗Not tracking mileage contemporaneously (reconstructed logs fail audits)
✗Including commuting miles as business
✗Deducting parking and tolls under standard rate (you can!)
✗Switching methods mid-year (can't do this)

How AlphaTax Helps

AlphaTax's Mileage Tracker lets you log business trips manually and compare standard mileage vs actual expense methods to find your larger deduction. Upload statements to track actual vehicle costs.

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Related AlphaTax Features

Mileage Tracker

Standard vs Actual Expense Comparison

Frequently Asked Questions

Standard mileage or actual—which saves more?

Standard rate is better for fuel-efficient cars. Actual expenses often win for older cars with high repair costs. AlphaTax compares both for you.

Can I deduct Uber/Lyft rides?

Yes, business-purpose rideshares are deductible as transportation expenses, separate from your personal vehicle deduction.