- If you use your car as a small-business owner or as someone who is self-employed, you can deduct the mileage from traveling from one business location to another. The mileage deduction can only be taken if you itemize your deductions rather than taking the standard deduction. If you chose to itemize your deductions, you must fill out a form 2016. Since it is a miscellaneous deduction, it must be greater than 2 percent of your adjusted gross income. You must also chose whether to deduct actual car expenses or the standard mileage rate.
- The per-mile rate is usually announced every November for the following year. For 2009, the rate for business travel is 55 cents per mile; the rate for medical or moving purposes is 24 cents, and the rate for driving for charity organizations is 14 cents. Multiple the number of qualifying miles you have driven by the appropriate rate to get the deduction you are eligible to take. For example, if during the year, you drove 4,000 miles for business and drove 100 miles for charity, you would multiple 4,000 by 55 cents and 100 by 14 cents, so your total deduction would be $2,214.
- If your employer reimburses you for the mileage, you may still be able to take a smaller deduction. If the per-mile reimbursement from your employer is less than the IRS mileage rate, you may still deduct the difference. For example, if your employer reimburses you 20 cents per mile and the current deduction is 50 cents, subtract 20 cents from 50 cents and your deduction is 30 cents per mile.
