Standard Mileage Deduction
A simplified method of deducting vehicle expenses based on business miles driven, using the IRS-published standard mileage rate.
Detailed Explanation
For 2025, the standard mileage rate is 70 cents per business mile. The taxpayer multiplies business miles by the rate to compute the deduction. The alternative is the Actual Expense Method (gas, insurance, depreciation, repairs, prorated by business use). Once the actual method is used, the standard rate may not be used in subsequent years for that vehicle. Detailed mileage logs (date, destination, purpose, miles) are required to substantiate the deduction.
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Schedule C (Profit or Loss from Business)
The federal tax form filed with Form 1040 to report income and expenses of a sole proprietorship or single-member LLC treated as a disregarded entity.
Self-Employment Tax
The Social Security and Medicare tax (15.3% combined) paid by self-employed taxpayers on their net earnings from self-employment.
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