Know What the IRS Say About Deducting More Than One Vehicle

Contrary to popular belief, the IRS does not limit business owners to claiming deductions on only one business vehicle. Here are some resources and information on deducting more than one vehicle.

Small businesses might maximize tax benefits by using multiple vehicles for business purposes. This is particularly true when

    • the vehicles are used predominantly (more than 50 percent) for business,
    • you drive more business miles than your spouse, and
    • the vehicles have closely aligned adjusted bases.

The allowability of multiple vehicle use is made clear in both IRS Publication 463 and IRS Form 4562.

Several tax court rulings have upheld small businesses’ right to claim business deductions on multiple vehicles within the same tax year.

Here’s an example of how your small business might benefit from deducting more than one vehicle: An attorney, Mel, utilized his and his wife’s vehicles for business purposes. By strategically alternating between using the two cars for business trips, he increased his deductions by up to $32,460 without spending more money or driving more miles.

As professional accountants, we can help you assess the financial benefits of this opportunity. Our team is experienced in financial evaluations and can provide accurate projections. Contact us for our services and trust us to provide sound advice on the best course of action for deducting more than one vehicle.

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