Hi,

I am a dentist and incorporated as S-corp.
Is it a good idea to take the vehicle deduction on actual basis? If so, is it necessary to have the Vehicle registered under the corporations name.
OR
Is it possible to take the vehicle deduction on actual basis even if the car is registered under my personal name.
The vehcle is used for more than 75 % for business use?
Pls advise
Thanks

I have a similar question. Could you discuss the rules for vehicle deductions

In theory, since your are incorporated, if the vehicle is not owned through the corporation, you are only allowed to reimburse yourself for business miles driven at the standard mileage rate of $.405 per mile.

If the corporation owns the vehicle, then you'll base the deduction on actual expenses incurred. The corporation will make the car payments, and pay for all the vehicle-related expenses including gas, insurance, and repairs. At the end of the year, you'll tally up all the vehicle expenses paid during the year, determine a personal use percentage, and report that portion of the vehicle's expenses on your W-2 as taxable income.

Let's say you weren't a corporation. In that case, you'll have the option of calculating your vehicle deduction based on actual expenses incurred or on the standard mileage rate. As a general rule of thumb, you're almost always better off basing the deduction on the standard mileage rate unless you drive relatively few miles during the year, with most of those miles qualifying as business miles.

Zip Code: cpa@mdtaxes.com