Cole purchased a car for business and personal use.In 2014,he used the car 60% for business (13,000 total use miles)and used the standard mileage rate to calculate his vehicle expenses.He also paid $1,500 in interest and $360 in county property tax on the car.What is the total business deduction related to business use of the car rounded to the nearest dollar?

Question

Quizplus · Accepted Answer

To calculate the total business deduction related to the business use of the car, we need to add up the following expenses:

1. Vehicle expenses using standard mileage rate:
60% of total use miles = 13,000 x 0.6 = 7,800 miles
Standard mileage rate for 2014 = $0.56/mile
Deductible vehicle expenses = 7,800 x $0.56 = $4,368

2. Interest paid on the car loan: $1,500

3. County property tax paid on the car: $360

Total business deduction = $4,368 + $1,500 + $360 = $6,228
Rounded to the nearest dollar, the answer is C) $5,484.

Cole Purchased a Car for Business and Personal Use