How Delivery Drivers Track and Deduct Vehicle Wear and Tear

What counts as wear and tear, and why it matters for your taxes

Wear and tear is the gradual damage and deterioration that happens to your vehicle from normal use — engine oil breaks down, tires wear smooth, brakes fade, suspension parts loosen. For delivery drivers, the IRS lets you deduct these costs on your taxes because the vehicle is a business tool, not a personal car. You can deduct either the actual cost of repairs and maintenance, or use the standard mileage rate, which is a fixed amount per mile that accounts for wear and tear automatically.

The choice between these two methods — actual expenses or standard mileage — affects how much you can deduct and how much record-keeping you have to do. Most delivery drivers find one method simpler than the other depending on how much they drive and how many repairs their vehicle needs.

Key Takeaways

• The IRS standard mileage rate for 2024 is 67 cents per mile for business use, which includes wear and tear without requiring you to track individual repairs.
• If you track actual expenses, you can deduct repairs, maintenance, oil changes, new tires, and parts — but you must keep receipts and know what percentage of your driving is for delivery work.
• You cannot use both methods in the same year; you must choose one and stick with it for the entire tax year.
• Wear and tear does not include loan payments, insurance, or registration fees — those are separate deductions with their own rules.
• The standard mileage rate changes each year, so check the current rate before you file your taxes.

The standard mileage rate method

The standard mileage rate is a per-mile deduction set by the IRS each year. For 2024, the rate is 67 cents per mile for business use. You multiply your total business miles by this rate to get your deduction — no receipts required, no guessing about what percentage of a repair was business-related.

To use this method, you need to track only your mileage: the miles you drive for deliveries. You do not need to keep repair receipts or maintenance records. At the end of the year, add up all your delivery miles and multiply by the current rate. If you drove 30,000 miles for delivery work in 2024, your deduction would be 30,000 × $0.67 = $20,100.

The standard mileage rate is simpler if your vehicle is reliable and does not need frequent repairs. It is also the only method available if you want to deduct vehicle expenses in your first year of business use — you cannot use actual expenses in year one and then switch to standard mileage later.

The actual expenses method

If you choose actual expenses, you deduct the real cost of repairs, maintenance, and parts. This includes oil changes, new tires, brake pads, filters, spark plugs, transmission fluid, coolant flushes, and any repair work done by a mechanic. You keep every receipt and add them up at the end of the year.

The catch is that you can only deduct the business portion of these costs. If you drive 40,000 miles total in a year but only 30,000 are for delivery work, you can deduct 75 percent of your repair costs (30,000 ÷ 40,000). You need to track both your business miles and your total miles to calculate this percentage.

Actual expenses make sense if your vehicle is older, needs frequent repairs, or has high maintenance costs. A vehicle with a major repair — a new transmission, engine work, or suspension replacement — can generate a large deduction in that year. However, you must keep detailed records: receipts, invoices, dates, and a mileage log showing business versus personal use.

What you cannot deduct as wear and tear

Loan payments and interest are not wear and tear deductions. If you financed your vehicle, the loan itself is not deductible. However, the interest portion of your loan payment may be deductible as a business expense — check with a tax professional on how to separate interest from principal.

Insurance and registration are separate deductions. Vehicle insurance premiums and registration or license fees are business expenses, but they are not part of wear and tear. You deduct them in addition to either the standard mileage rate or actual expenses.

Parking, tolls, and fuel are also separate. If you use the standard mileage rate, fuel is already included in the per-mile amount. If you use actual expenses, you can deduct fuel separately, but parking fees and tolls are their own line item, not part of wear and tear.

How to track mileage for the standard rate method

You need a record that shows your total business miles for the year. The IRS does not require a specific format, but you should be able to show how you arrived at your number if you are audited. Many drivers use a simple spreadsheet or a mileage app on their phone.

At minimum, keep a log that notes the date, starting odometer reading, ending odometer reading, and purpose of the trip (for example, "DoorDash deliveries, downtown area"). You do not need to log every single trip if you can show a pattern — for instance, if you work five days a week and average 60 miles per day, you can calculate your annual mileage from that pattern and document it.

Some delivery platforms (DoorDash, Uber Eats, Instacart) show your trip history in the app, which can serve as backup documentation. However, these apps do not always show exact mileage, so keeping your own odometer record is safer.

How to track expenses for the actual expenses method

Keep every receipt for repairs, maintenance, and parts. Take photos of receipts if you pay in cash, or save email confirmations if you pay online. Organize them by month or by category (tires, oil changes, repairs) so you can add them up at tax time.

For each receipt, note the date, the vendor, what was done or purchased, and the cost. If a repair involved both business and personal use — for example, a general inspection that applies to all your driving — estimate the business percentage and deduct only that portion.

You also need a mileage log showing your total miles and your business miles for the year. This percentage determines how much of your repair costs you can actually deduct. If you drove 25,000 business miles out of 35,000 total miles, you can deduct 71 percent of your repair expenses (25,000 ÷ 35,000).

Switching between methods and what happens to depreciation

Once you choose a method in your first year of business use, you can switch to the other method in a later year — but there are rules. If you used the standard mileage rate in year one, you can switch to actual expenses in year two. However, if you used actual expenses in year one, switching to standard mileage in year two is more complicated and may require IRS approval.

If you use the standard mileage rate, you cannot also deduct depreciation (the declining value of your vehicle over time). The mileage rate is meant to cover wear and tear and depreciation together. If you use actual expenses, you can deduct depreciation separately, but the calculation is complex and usually requires a tax professional.

Frequently Asked Questions

Do I have to use the standard mileage rate, or can I always choose actual expenses?

You can choose actual expenses, but only if you did not use the standard mileage rate in your first year of business use. If you used standard mileage in year one, you can switch to actual expenses in year two. If you used actual expenses in year one, switching back to standard mileage later is difficult and may require IRS approval.

What if I use my personal car for deliveries only part of the time?

You can still deduct wear and tear, but only for the business portion. Track your total miles and your delivery miles separately. If you drove 40,000 miles total and 24,000 were for deliveries, you can deduct 60 percent of your repair costs or use the standard mileage rate on 24,000 miles.

Can I deduct wear and tear if I lease my vehicle instead of owning it?

No. Lease payments are a separate deduction. You cannot deduct wear and tear on a leased vehicle because you do not own it and are not responsible for repairs — the leasing company is. You can deduct the lease payment itself as a business expense.

What if I have a major repair, like a new engine or transmission?

Major repairs are deductible as wear and tear if you use actual expenses. However, if the repair extends the useful life of the vehicle significantly — for example, a new engine that lets you keep the car for five more years — the IRS may classify it as a capital improvement rather than a repair, which changes how you deduct it. A tax professional can help you determine the right treatment.

Do I need to keep my mileage log forever?

The IRS generally looks back three years in an audit, so keep your mileage logs and receipts for at least three years after you file your tax return. Many tax professionals recommend keeping them for seven years to be safe.