Table of Contents
Standard mileage rate. For 2008, the standard mileage rate for the cost of operating your car for business use is:
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50½ cents per mile for the period January 1 through June 30, 2008, and
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58½ cents per mile for the period July 1 through December 31, 2008.
Car expenses and use of the standard mileage rate are explained in chapter 4.
Depreciation limits on cars, trucks, and vans. For 2008, the first-year limit on the total section 179 deduction, special depreciation allowance, and depreciation deduction for most cars has increased to $10,960 ($2,960 if you elect not to claim the special depreciation allowance). For trucks and vans, the first-year limit has increased to $11,160 ($3,160 if you elect not to claim the special depreciation allowance). Depreciation limits are explained in chapter 4.
Special depreciation allowance. Generally, new cars, trucks, and vans purchased and placed in service in 2008 qualify for a special depreciation allowance. The special allowance is a depreciation deduction equal to 50% of the adjusted basis of the vehicle. See Special Depreciation Allowance in chapter 4.
Meal expenses when subject to “hours of service” limits. Generally, you can deduct only 50% of your business-related meal expenses while traveling away from home for business purposes. You can deduct a higher percentage if the meals take place during or incident to the Department of Transportation's (DOT) “hours of service” limits. (These limits apply to certain workers who are subject to certain federal regulations.) For 2008, the percentage is increased to 80%.
Photographs of missing children. The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child.
You may be able to deduct the ordinary and necessary business-related expenses you have for:
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Travel,
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Entertainment,
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Gifts, or
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Transportation.
An ordinary expense is one that is common and accepted in your trade or business. A necessary expense is one that is helpful and appropriate for your business. An expense does not have to be required to be considered necessary.
This publication explains:
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What expenses are deductible,
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How to report them on your return,
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What records you need to prove your expenses, and
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How to treat any expense reimbursements you may receive.
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You fully accounted to your employer for your work-related expenses.
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You received full reimbursement for your expenses.
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Your employer required you to return any excess reimbursement and you did so.
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There is no amount shown with a code “L” in box 12 of your Form W-2, Wage and Tax Statement.
Internal Revenue Service
Individual Forms and Publications Branch
SE:W:CAR:MP:T:I
1111 Constitution Ave. NW, IR-6526
Washington, DC 20224
Internal Revenue Service
1201 N. Mitsubishi Motorway
Bloomington, IL 61705-6613
Publication
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225 Farmer's Tax Guide
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529 Miscellaneous Deductions
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535 Business Expenses
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946 How To Depreciate Property
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1542 Per Diem Rates
Form (and Instructions)
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Schedule A (Form 1040) Itemized Deductions
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Schedule C (Form 1040) Profit or Loss From Business
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Schedule C-EZ (Form 1040) Net Profit From Business
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Schedule F (Form 1040) Profit or Loss From Farming
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2106 Employee Business Expenses
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2106-EZ Unreimbursed Employee Business Expenses
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4562 Depreciation and Amortization
See chapter 7, How To Get Tax Help , for information about getting these publications and forms.
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