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Ed Johnson
Ed Johnson, Tax Preparer
Category: Tax
Satisfied Customers: 10760
Experience:  GPHR Cert; U.S. Treasury Tax Advocacy Panel appointee
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Tax Question After my car was totaled (business use 25% personal

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Tax Question: After my car was totaled (business use 25% personal 75%), I rented a car for a 7 weeks before buying another car. The cost of this car rental was $3,325. During this 7 week period, I used this car for 75% business and 25% personal. I file as a sole proprietor and pay self-employment taxes. On my 2006 taxes, is it possible to deduct the cost of the temporary car rental, and if so, how (which forms)?
Submitted: 8 years ago.
Category: Tax
Expert:  Ed Johnson replied 8 years ago.



I am assuming you are cash accounting basis. I see you asked a simliar question about the ability to take the rental expenses as part of a business casualty loss.


so now you wish to know if you can take it as a business expense.


You can apportion the rental expense between personal and business use. The IRS requires a mileage log sufficient to determine business and personal use.,,id=163780,00.html


Those who file Schedule C may deduct all business-related transportation expenses. Employees and independent contractors may use their job-related travel as a tax deduction by filing Form 2106.


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