Refer to Publication 463, Travel, Entertainment, Gift, and Car Expenses. If you use your car for both business and personal purposes, you must divide your expenses based on actual mileage. If you use your car in your business, you can deduct car expenses. Refer to Home Office Deduction and Publication 587, Business Use of Your Home, for more information. These expenses may include mortgage interest, insurance, utilities, repairs, and depreciation. If you use part of your home for business, you may be able to deduct expenses for the business use of your home. Refer to chapter 4 of Publication 535, Business Expenses, for information on deducting interest and the allocation rules. The remaining 30% is personal interest and is not deductible.
You can deduct the business part.įor example, if you borrow money and use 70% of it for business and the other 30% for a family vacation, you can deduct 70% of the interest as a business expense. However, if you have an expense for something that is used partly for business and partly for personal purposes, divide the total cost between the business and personal parts. Generally, you cannot deduct personal, living, or family expenses. Refer to chapters 7 and 8 of Publication 535, Business Expenses. Note: You can elect to deduct or amortize certain business start-up costs.
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