In April 2018, Tobias, a sole proprietor, worked for a new client in the next county for the day. He drove 75 miles each way for the job, paid $4 in tolls, $7 for parking and $9 for lunch. What is his allowable business expense deduction?
A) $56
B) $81.75
C) $92.75
D) $93.50

Question

Quizplus · Accepted Answer

- Mileage deduction: He drove 75 miles each way, so a total of 150 miles for the day. The 2018 standard mileage rate for business use of a vehicle is 54.5 cents per mile. Therefore, Tobias can deduct 150 miles x $0.545/mile = $81.75 for mileage.
- Tolls and parking expenses: Tobias paid $4 in tolls and $7 for parking, so he can deduct those expenses in full. Total deduction: $4 + $7 = $11.
- Meal expenses: The IRS allows a 50% deduction for meals that are business-related. Tobias spent $9 on lunch, so he can deduct 50% of that amount, or $4.50.
- Total deduction: $81.75 + $11 + $4.50 = $92.25. Rounded to the nearest whole dollar, the allowable business expense deduction is $92.

In April 2018, Tobias, a Sole Proprietor, Worked for a New