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Jackson, a self-employed taxpayer, uses his automobile 90% for business and during 2020 drove a total of 17,800 business miles. Information regarding his car expenses
Jackson, a self-employed taxpayer, uses his automobile 90% for business and during 2020 drove a total of 17,800 business miles. Information regarding his car expenses is listed below. Business parking $ 290 Auto insurance 2,900 Auto club dues (includes towing service) 348 Toll road charges (business-related) 435 Oil changes and engine tune-ups 464 Repairs 319 Depreciation allowable 5,800 Fines for traffic violations (incurred during business use) 580 Gasoline purchases 6,380 What is Jackson's deduction in 2020 for the use of his car if he uses: If required, round your answers to nearest dollar. a. The actual cost method? b. The automatic mileage method? c. What records must Jackson maintain? Keeping a written or electronic log of miles driven, the dates the automobile was used, the location of travel, and the business purpose is enough evidence for the . If the is used, keeping copies of receipts, canceled checks, and bills in addition to a mileage log is sufficient. Records and logs should be kept contemporaneously (e.g., updated weekly or daily)
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