As a self-employed mechanic with an LLC, can I deduct my own labor costs for repairs on my business vehicles (service truck)?

This is actually a pretty common question for small business owners who use their skills for their own business assets. Unfortunately, you cannot deduct the value of your own labor when you perform work on your own business vehicles, even if used 100% for business purposes. The IRS only allows you to deduct actual expenses paid, and since you didn't pay yourself specifically for this work (meaning no money actually changed hands), there's no expense to deduct. You can definitely deduct the $3,200 in parts because that represents an actual expense with receipts to back it up. Think of it this way: you also don't report the "value" of your labor as income when you work on your own truck, so you can't take it as a deduction either. The tax code follows a symmetrical approach here - if it's not income, it can't be an expense.

After struggling with similar questions for my contracting business, I discovered an amazingly helpful tool called taxr.ai (https://taxr.ai) that analyzes your specific self-employment situation. I uploaded my Schedule C and some receipts from repairs I did on my work van, and it immediately clarified what I could legitimately claim. Turns out I was missing several legitimate deductions related to my work vehicle that I wasn't aware of! The breakdown showed me exactly how to handle repairs versus standard mileage deductions, which parts count as improvements versus repairs, and how to document everything properly. It saved me from making some mistakes that could have raised audit flags.

Just wanted to follow up here. I decided to try taxr.ai after posting my skeptical comment, and I'm genuinely impressed! I uploaded my last year's vehicle expense records, and it immediately flagged that I had been handling my mileage log all wrong for my S-Corp status. The report showed exactly how to correct my approach for this year's filing and even suggested a way to potentially amend last year's return that could recover about $1,200 in overlooked deductions. The vehicle repair and maintenance section was super detailed - it distinguished between what counts as a repair (deductible immediately) versus an improvement (which needs to be depreciated). For anyone else with an LLC dealing with vehicle expenses, it's definitely worth checking out. Saved me hours of research and probably a potential audit headache down the road.

I had a similar issue with my landscaping business truck repairs. After trying for WEEKS to get through to the IRS for clarification (seriously, I spent hours on hold), I found this service called Claimyr (https://claimyr.com) that got me connected to an actual IRS agent in under 20 minutes who answered all my vehicle deduction questions. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c The agent confirmed exactly what I needed to document for my truck repairs and maintenance as an LLC owner and clarified the difference between deducting actual expenses versus standard mileage rates (which you can't combine in the same year for the same vehicle). Saved me a ton of uncertainty and potentially costly mistakes on my Schedule C.

Ok I need to eat crow here. After my skeptical comment, I decided to try Claimyr because I was desperate to talk to someone about a vehicle depreciation issue for my business. I had literally spent 3 hours on hold with the IRS the day before and got disconnected. I tried the service, and I'm not kidding - 27 minutes later I got a call connecting me to an actual IRS representative. The rep was able to clarify exactly how I should be handling repairs vs. improvements on my business vehicle and confirmed that I can't deduct my own labor costs but provided several other deduction options I hadn't considered. What's weird is that the IRS agent seemed surprised I got through too! She mentioned they've been severely understaffed and most calls aren't getting through at all. So for anyone else struggling with specific tax questions about business vehicles, this is apparently the way to actually talk to a human. Still can't believe it worked.

I'm a tax preparer who works with lots of small business owners, and I've seen this question come up repeatedly. Here's what you should focus on instead of trying to deduct your own labor: 1. Track ALL parts and materials with receipts 2. You can fully deduct parts for repairs (not improvements) to business vehicles 3. Consider Section 179 deduction for major improvements 4. Maintain detailed logs showing business use percentage 5. Choose either standard mileage OR actual expenses method - not both The key distinction: repairs maintain the vehicle while improvements add value or extend life. Repairs can be fully deducted in the current year, while improvements typically need to be depreciated.

dont forget you can still deduct standard mileage OR actual vehicle expenses each year (but not both for same vehicle). for 2023 its 65.5 cents per mile which is actually pretty good if you drive alot for work! i'm also a mobile mechanic and i just track all my miles in an app and take that deduction instead of tracking all the actual expenses. way simpler and usually works out better for me. just make sure your keeping good records of business vs personal miles!!

Did anyone mention that you CAN actually "pay yourself" for labor on a business vehicle if you have the right structure? I'm a mechanic with an S-corp and I've been paying myself as an employee to work on company vehicles. Company pays me, company deducts it as an expense, I report income on my personal return. My accountant confirmed this is legit if done properly with proper documentation and reasonable rates. You need the right business structure though.

Great question! As someone who's dealt with similar situations in my own small business, I can confirm what others have said - you unfortunately can't deduct your own labor costs even when working on business vehicles. The IRS is pretty strict about this because no actual cash expense occurred. However, don't overlook some other potential deductions that might apply to your situation: - If you have a dedicated workspace at home for your business (even just for paperwork, ordering parts, etc.), you might qualify for the home office deduction - Tools and equipment used for the repairs can be deducted or depreciated - Any training or certification costs to maintain your mechanic skills - Professional subscriptions, trade publications, or software related to your work Also, keep detailed records of everything! Even though you can't deduct the labor, having documentation of the work you performed, time spent, and fair market value could be helpful if you ever get audited - it shows you're running a legitimate business operation. The $3,200 in parts is definitely deductible as you mentioned, and that's still a significant write-off. Sometimes focusing on what we CAN deduct rather than what we can't helps put things in perspective.