Question

22. For the current year, Al Johnson used his personal car for both business and personal purposes. He drove 18,000 miles in the car during the year: 10,000 miles were for business-related purposes and 8,000 miles were for personal purposes. He incurred the following car expenses during the year: Amount Expense Gas $7,900 900 Maintenance Repairs and depreciation Car washes Totale nton 900 500 $10,200 nobo Based on this information, what part of the above car expenses is deductible as business- related expenses on Al's current year income tax return? bns

Answer 1

As per the g guideline, I answered only one question. please post the remaining question separately.

22)

a) Mileage for business * IRS rate (0.555)

b) Proportionate expense based on mileage

Calc. :-

1) Deductible as per IRS rate = 10000*0.555

= 5550

2) Deductible based on mileage proportion = 10200*10000/18000

= 5666.67

Accordingly deductible business expenses = $56667