Vehicle Expenses
Response to the following problem:
Shaun uses his personal car for work. Shaun is employed as a messenger. In 2014, he drove 12,400 work-related miles and 18,340 total miles. His employer reimburses him $.30 a mile for his documented business miles under an accountable reimbursement plan. Shaun's car expenses for the year were as follows. In addition, Shaun paid $398 in business-related parking
Depreciation $2,498
Gas 2,347
Insurance 1,840
License tags 120
Repairs and maintenance 122
$6,927
a. Compute Shaun's car expense deduction using the standard mileage method.
b. Compute his car expense deduction using the actual expenses method.
c. Based on your answers to Parts a. and b., under what conditions should Shaun use the standard mileage method?
d. Based on your answers to Parts a. and b., under what conditions must Shaun use the actual expenses method?