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Tax Tidbit 12/06: Are You Maximizing Your Auto Expenses For Your Business?

Many business owners overlook legitimate business auto deductions.  You can deduct auto expenses if you are:

• Traveling from one work location to another work location within your tax home area;
• Visiting customers;
• Attending a business meeting away from the regular workplace; and
• Traveling from home to a temporary workplace if you have one or more regular places of work.

You can either use the standard method (44.5 cents per mile) or the actual cost method for a car.  If you chose the actual method and you purchased the car, you may be eligible for generous up-front depreciation deductions, if the car’s unloaded gross weight exceeds 6,000 pounds.  Please note that you cannot deduct costs relating to your personal/commuting use of your car.

If you have any questions regarding how to maximize tax deductions for your business vehicles, and what impact the purchase of a new vehicle may have on those write-offs, please contact Andy Ross, CPA of Bedard, Kurowicki & Co., CPA's, PC at 908-782-7900, ext. 113.