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January 25, 2020
Question

How do you file your car as an expense?

  • January 25, 2020
  • 1 reply
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January 27, 2020

It depends. If you have a small business, your car expenses may be deductible. If you work at a W2 job, your car expenses are not deductible. In any case, you may deduct certain local car taxes based on the value of your car on Schedule A.

 

The Tax Cuts and Jobs Act 2018 eliminated the deductibility of Misc. Deductions Subject to the 2% Floor for the years 2018 to 2025 on the Federal tax return. This includes unreimbursed job expenses and vehicle expenses for W2 work. Some states, like California, still allow the deduction. To enter the information for the state deduction:

 

  • You should be signed in and working on TurboTax
  • In the black, left-hand menu, click on Federal.
  • Then click on Deductions and Credits.
  • Scroll down and click on Employment Expenses (you may have to click on More Deductions and Credits first)
  • Then click on Job Expenses on W2 Income.
  • Walkthrough the screens until you get to vehicle expenses. 

 

If you are an independent contractor or a business owner, your vehicle expenses are still deductible. You can find these vehicle expenses under the expenses for your self-employed income.

 

If you wish to deduct the state/local taxes on the value of your vehicle and you are itemizing deductions:

 

  • You should be signed in and working on TurboTax
  • In the black, left-hand menu, click on Federal.
  • Then click on Deductions and Credits.
  • Click on Cars and Other Things You Own
  • Click on Car Registration Expenses

 

 

Car expenses are still deductible for medical or charitable reasons if you are itemizing deductions.

 

There are more information vehicle expenses here

 

 

 

 

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