The IRS could give you a credit for your car, even if it is not electric.
The owners of no electric cars could receive a credit from the IRS this season. Those who use their cars for business can get total or partial tax rebates. This is what you need to do in your next declaration.
You can request a tax deduction for your car from the IRS this season, even if you don’t drive an EV car.
“If you use your car only for business purposes, you may deduct its entire cost of ownership and operation (subject to limits discussed later). However, if you use the car for both business and personal purposes, you may deduct only the cost of its business use,” according to Topic No. 510, Business Use Car, from the IRS.
How can I deduct my car from my taxes?
You can deduct your car expenses using one of these two methods:
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The standard mileage rate
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The actual expense method
Before deciding what deduction to use this tax season, figure out which of those will give you the largest deduction. Please check with your accountant or an expert before moving further.
Standard Mileage Rate
For the standard mileage rate for the cost of operating your car for business, refer to Standard Mileage Rates or Publication 463, Travel, Entertainment, Gifts, and Car Expenses.
To use the standard mileage rate, you must own or lease the car and:
- You must not operate five or more cars at the same time, as in a fleet operation,
- You must not have claimed a depreciation deduction for the car using any method other than straight-line,
- You must not have claimed a Section 179 deduction on the car,
- You must not have claimed the special depreciation allowance on the car, and
- You must not have claimed actual expenses after 1997 for a car you leased.
To use the standard mileage rate for a car you own, you must choose to use it in the first year the car is available for use in your business. Then, in later years, you can choose to use the standard mileage rate or actual expenses.
For a car you lease, you must use the standard mileage rate method for the entire lease period (including renewals) if you choose the standard mileage rate.
Actual Expenses
 To use the actual expense method, you must determine what it costs to operate the car for the portion of the overall use of the car that’s for business use. Include gas, oil, repairs, tires, insurance, registration fees, licenses, and depreciation (or lease payments) attributable to the portion of the total miles driven that are business miles.
Note: Other car expenses for parking fees and tolls attributable to business use are separately deductible, whether you use the standard mileage rate or actual expenses.
Depreciation of your car
Generally, the Modified Accelerated Cost Recovery System (MACRS) is the only depreciation method that can be used by car owners to depreciate any car placed in service after 1986. However, if you used the standard mileage rate in the year you place the car in service and change to the actual expense method in a later year, before your car is fully depreciated, you must use straight-line depreciation over the estimated remaining useful life of the car.
