I currently drive round trip to and from work 54 miles. 18 miles to my office every day then 12 miles to the hospital then 24 miles back home. Can I deduct the gas mileage for the 12 miles to the hospital and the 24 miles home or just the 12 miles to the hospital. Also of the 20000 miles I drive annually 13000 is work related....can I therefore deduct a percentage of my car payment and car insurance or not. Last but not least...for the first 6 months of the year I leased my car then bought it outright in July. How does that affect any of the deductions or does it?. Thanks in advance for answering.

Driving between job sites is deductible. So is driving between your home and a temporary job site, or to meetings, interviews, and seminars. Commuting between your home and a regular place of business is generally not tax deductible (unless you have a home office.)

When you calculate your auto deduction, you can either base the deduction on the standard mileage rate of $.485 per business mile (in 2007 increasing by a lousy two cents to $.505 in 2008) multiplied by the total business miles driven during the year. Or you can add up all your automobile expenses - including gas, insurance, repairs, parking at home, and your lease payments if you lease your car or a factor for depreciation if you own your car - and multiply that total by the percentage of miles driven during the year that are businss miles.

I included an example of this math in an article on the December 2006 newsletter available at: http://www.mdtaxes.com/news1206.html.

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