For entering vehicle expenses in an individual return, Intuit ProSeries has a Car and Truck Expense Worksheet. You should use this worksheet if you're claiming actual expenses or the standard mileage rate. Once you enter in the information for the vehicle, ProSeries compares what gives a better deduction for the tax return and gives you the larger deduction.
Business entities don't have a separate worksheet and would use the asset entry worksheet to calculate depreciation on vehicles.
Completing the Vehicle Information section.
Each vehicle must have the Vehicle Information filled out, regardless of the deduction method.
- Line 3: Date placed in service: enter the date the vehicle was placed in service using a mm/dd/yy format. If the vehicle is being depreciated, this date is used to help decide the depreciation type.
- Line 4: Type of vehicle: enter a type of vehicle. If the vehicle was placed in service after 1980, the program completes the rest of the depreciation information. You must manually complete the depreciation information for any vehicles placed in service before 1980.
- Lines 5 through 8: Beginning and ending mileage on lines 5a and 5b aren't mandatory, but if you enter that information, the total miles on line 5c automatically calculate and carryforward the ending mileage to next year's return. If you make an entry on line 9, then lines 5, 6 and 7 should only include those miles driven during the period of business use.
- For a vehicle acquired in a trade-in that is required to be reported using multiple bases, enter the total mileage on each portion of the vehicle. Since the vehicle isn't eligible for the standard mileage deduction, there's no need to prorate the mileage between the separate portions of the basis.
- Line 9: Percentage of business use: if the percentage of business use has changed from last year, the depreciation calculations handle the change automatically. There's no need to change your entries for cost or prior depreciation unless business use drops from above 50% to 50% or less. But, you must check No on line 66 (Use IRS tables for MACRS property?) because you can't use the tables to compute depreciation when the percentage of business use changes.
- When business use drops to 50% or less, depreciation and section 179 expense may be subject to recapture. You must manually complete Form 4797, Part IV to compute the recapture.
Completing the Standard Mileage Rate section
- Lines 15 through 17: Standard mileage deduction: if the taxpayer qualifies the program, computes the standard mileage rate by multiplying the business miles on line 6 by the Standard Mileage Rate for the year. See Standard Mileage Rates for year-specific rates.
Completing the Actual Expenses section
When entering actual expenses for a vehicle acquired in a trade-in that is required to be reported using multiple bases, only enter the expenses once. Don't repeat the expenses for each portion of the basis.
- Line 20: Expense applicable to business: this is calculated by multiplying the vehicle expenses by the business use percentage.
Completing the Standard Mileage vs Actual Expenses section
- Lines 23 and 24: Standard Mileage vs. Actual Expenses: ProSeries will optimize the larger deduction but you can force a method by checking box 23 or 24.
Completing the Total Car and Truck Expenses section
This section should be completed for all vehicles. Entries in this section will be used to calculate the actual expenses for the vehicle.
Completing the Vehicle Depreciation Information section
If you are claiming the standard mileage rate this section can be left blank.
- Lines 31: Cost or basis: enter the appropriate cost or basis on line 30. Do not reduce this by percentage of business use.
- Line 32: Section 179 expense elected: Enter the section 179 expense deduction for vehicles placed in service both this year and in prior years., even if the vehicle was fully expensed.
- Line 35: Prior Depreciation: enter the greater of the allowed or allowable depreciation deductions taken in prior years. Don't include any section 179 or special depreciation allowance deductions.
- If you leave this blank, the program uses the allowable prior depreciation as shown on the Asset Life History, to compute the current year depreciation.
- Line 36: Depreciation deduction: once you make all the required entries, the program computes the current year's depreciation deduction for this vehicle. The program automatically applies the auto limitation and posts only the allowable deduction. See Pub 463 for depreciation limits for more information.
- Line 37: AMT prior depreciation: if there's no entry in this field, enter the greater of the allowed or allowable AMT depreciation deductions taken in prior years. Don't include any section 179 or Special Depreciation Allowance deductions.
- If you leave this field blank, the program uses the allowable AMT prior depreciation, as shown on the Asset Life History, to compute the current year AMT depreciation deduction.