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Sign into your accountParking Deduction 101: Writing Off Parking Costs on Taxes
March 07 2017
The mileage deduction is one of the largest tax savings you can get if you use a personal car for business purposes. But, there are various vehicle-related deductions for self-employed individuals like real estate agents and brokers. Let's go over the parking deduction and see how it can impact your tax bill.
Parking Deduction: What Qualifies
According to the IRS, you can deduct "business-related parking fees when visiting a customer or client." Some examples of this include paying to park visiting a client, paying for parking at the airport during business trips and other work-related trips.
The IRS also allows you to deduct the cost of tolls incurred during business trips. This could start to add up depending on where you are and what you do. For example, a ride-sharing driver for Uber or Lyft in the Bay Area could wind up with multiple write-offs for tolls at the end of the year.
Remember, you cannot deduct the parking fees you pay to park your car at your place of work. This is considered a non-deductible commuting expense. One potential way around this is to have a qualifying home office. With this, your trips to the office go from non-deductible commutes to business mileage—the parking costs may also qualify for tax relief.
You're also not allowed to write off the costs of parking tickets. This is true even if you got the ticket parking for business purposes.