Personal vehicles used for Husband/Wife LLC Partnership as well as personal mileage

Forum|Forum|3 years ago
February 26, 2023
2 replies
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2022 Tax Year. Husband/wife have small LLC Partnership business selling to retailers, and direct customer sales via trade shows and requests. We have 5 vehicles, 2 or 3 are used about 10% of annual miles for business travel. It's beyond me to keep track of every vehicle cost item, I do a lot myself, we pay cash for the vehicles, most have lifetime registration fee and of course 1 insurance bill. I know the exact business and annual miles used by each vehicle. I would like to say the owner of a car (husband's or wife's) contributed the value of the IRS mileage for business miles and the business "didn't get the cash value" because it was spent/expensed to use the vehicle. So for 200 miles of the husband's car driven to trade show, the husband contributed $0.585*200=$117 to his % ownership of business and the business had $117 of vehicle expense. Each car and owner gets treated similarly. I'm not trying to be clever, actual annual vehicle costs mean little compared to average annual lifetime operating cost.

PatriciaV

Employee

Please clarify the question you are asking. Do you need to know how to report business vehicle mileage in TurboTax?

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ART05Author

TT Business does not allow business mileage to be entered. It does not allow vehicles to be added or removed. It says only actual vehicle expenses can be entered. It has done this to me for 8yrs. Help outside TT suggested I total std mileage amounts outside TT and enter them as misc vehicle deduction. I lost 7yrs of vehicle deductions because of the mistake. On the order of 30% of profit. Huge loss. I have 25+ yrs experience with 1040 products that allow std mileage deduction correctly. TT Help has already had access to my problem and issued a case number. How to do it and it can't be done are the same problem.

AliciaP1

A partnership filing IRS Form 1065 is not eligible to claim the standard mileage deduction for vehicles. You have years of experience with "1040 products" handling it because it is only allowed on an individual return.

If the partnership owns the vehicles, they should be entered as assets and depreciated along with actual expenses incurred. If the partnership needs to reimburse you for your mileage on your personal vehicle, that is merely an expense to the business when you submit a reimbursement request with your mileage calculated at the correct rate. It would be appropriate to list these expenses as Vehicle Expenses or Vehicle Reimbursements on the Partnership return.

@ART05

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Opus 17

Employee

Suggest you see an accountant.

Unless you live in a community property state, an LLC with more than one member must be reported on a form 1065 partnership return. This requires Turbotax Business, which is different from "Home & Business" and is only available as a CD or download for PC, there is no Mac or online version. The deadline for filing form 1065 is March 15, not April, and there are substantial penalties for filing late unless you get an extension. As part of preparing the 1065, each partner will receive a K-1 statement that is entered on their personal tax return (form 1040).

You may have several years of tax returns to correct, and an accountant can help navigate the process, teach you what you need to know for the future, and help negotiate any penalties.

If you live in a community property state and the only two members of the LLC are spouses, then you file as a special entity where each spouse files a schedule C listing half the income and half the expenses.