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Jackson, a self-employed taxpayer, uses his automobile 82% for business and during 2020 drove a total...

Jackson, a self-employed taxpayer, uses his automobile 82% for business and during 2020 drove a total of 27,600 business miles. Information regarding his car expenses is listed below.

Business parking $ 260
Auto insurance 2,600
Auto club dues (includes towing service) 312
Toll road charges (business-related) 390
Oil changes and engine tune-ups 416
Repairs 286
Depreciation allowable 5,200
Fines for traffic violations (incurred during business use) 520
Gasoline purchases 5,720

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?

answer is not 12875, thank you.

Solutions

Expert Solution

Amount $
Business parking (260 x 100% )                     260
Auto insurance (2,600 x 82% )                  2,132
Auto club dues (includes towing service) ( 312 x 82% )                     256
Toll road charges (business-related)                     390
Oil changes and engine tune-ups ( 416 x 82% )                     341
Repairs ( 286 x 82% )                     235
Depreciation allowable ( 5,200 x 82% )                  4,264
Gasoline purchases ( 5,720 x 82% )                  4,690
Actual Cost method- Deduction for 2020      12,568
Note:
Fines for traffic violations (incurred during business use) will not be allowed as Deduction.

ekkarill92 answered 1 year ago
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