Maximizing Tax Deductions for the Business Use of Your Car

The business use of your car can be one of the largest tax deduction you can take to reduce your business income. This is a big, big deal. Why two “bigs”? Because your business income is used to calculate two taxes: your personal income tax and your self-employment tax (the […]

The business use of your car can be one of the largest tax deduction you can take to reduce your business income. This is a big, big deal. Why two “bigs”? Because your business income is used to calculate two taxes: your personal income tax and your self-employment tax (the amount you pay into Social Security and Medicare as the “owner” of your rideshare business). Maximizing your deduction for the business use of your car will help you minimize these taxes.

Whether you’re a freelancer, independent contractor, small business owner, or have multiple sources of income, when you use TurboTax Self-Employed, we’ll help you uncover industry-specific deductions you qualify for to get you every dollar you deserve. It’s free to start, and enjoy $20 off TurboTax Self-Employed when you file.

There are two methods of calculating the business use of your car. You’ll want to calculate your vehicle expenses each way and then choose the method that yields the largest deduction for you. If you are using TurboTax Self-Employed, check out How do I enter my Lyft tax information? for step-by-step instructions.

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