Is Vehicle Insurance Tax Deductible?

If you are self-employed, are an independent contractor or if you use your vehicle for any business purposes beyond commuting to and from work, your auto insurance premium is likely tax deductible. However, if you use your car for both personal and professional reasons, only the portion of expenses associated with business use are tax deductible and must be prorated accordingly.

Tax Deductible Premiums: 3 Scenarios
those who receive non-employee compensation are required to submit a 1099 form to the IRS. If you receive income as a business owner or as an independent contractor, you’re receiving non-employee compensation and may be eligible for a tax deduction on your auto insurance. Likewise, if you are a full-time, salaried employee and use your car for work, you may also be eligible for auto expense-related tax deductions. Let’s look at three different scenarios in which deducting a portion of your insurance premium would be applicable:

Business Owner – You’re the sole proprietor of a home remodeling business. 60% of the total miles you drive are spent traveling to and from clients’ homes and back and forth between materials suppliers. Thus, 60% of your auto insurance premium payments will be tax deductible.

Contractor or Freelancer – You’re a freelance photographer and drive 15,000 miles a year, 7,500 miles of which you spend traveling to and from assignments or scouting locations. In this scenario, 50% of your auto insurance premium is tax deductible.

W-2 Employee or Salaried Employee – You are a full-time, salaried executive assistant and run frequent errands for your employer using Vehicle Insurance for your own car. The errands you run for work comprise 15% of your total miles driven. If your employer does not reimburse you, 15% of your total car expenses is tax deductible, including 15% of your insurance premium.

Standard vs. Itemized Deductions
you can choose to deduct driving-related work expenses by using either the standard per-mile deduction rate (for 2014, the rate was .56 per mile) or you can calculate the total cost of your actual expenses.

Car Key

The standard rate makes calculating expenses simple for self-employed taxpayers. The typical costs of fuel, insurance, depreciation, repairs, tolls, parking fees, licenses and other vehicle expenses are factored into the calculation of this rate. Many Americans who frequently use their vehicles for business purposes elect to use this standard mileage deduction.

Drivers who use relatively expensive vehicles for business purposes may be better off electing to deduct their actual expenses. For example, if you own a 1-ton diesel pickup truck and use it for business-related winter activities such as snow-plowing, you may determine that the per-mile cost of operating this truck is much more than the average vehicle and therefore more than the standard per-mile rate. However, if you choose to itemize your actual deductions, be sure to keep track of your mileage, as well as comprehensive records of all auto-related expenses.

Use the Most Advantageous Option
The IRS encourages taxpayers to calculate their deductions using both methods. The IRS website says: “If you qualify to use both methods, you may want to figure your deduction both ways to see which gives you a larger deduction.

Non-Eligible Expenses
you can only deduct expenses for which your employer does not already reimburse you. If you have a home office, you can deduct all work travel during the day except your first and last rides to and from home. These trips are considered your “commute,” and expenses related to your regular commute to and from work are not tax deductible.

You may also wonder whether or not the premiums you pay for the medical expense portion of your policy can be used as a medical deduction; they cannot.

Not All Vehicles Qualify
The IRS defines a vehicle for the purposes of work-related driving as a four-wheeled vehicle designed for use on public roads. This eliminates motorbikes, scooters and bicycles. The IRS also specifically excludes certain specialty vehicles like taxis, moving vans and ambulances. Vehicles that weigh over 6,000 pounds are also excluded.

For more detailed information, talk to your local tax specialist and give us a call at (800) 258-5101 to find the auto insurance policy that best fits your personal and professional driving needs. You can also find us on the web at


Cheap Car Insurance Tips

car insurance

Cheap car insurance is basically the forte around these parts and we’re always happy to pass on the savings we discover to you. Some new, some just worth a revisit, it is important that you read and absorb all the tips we supply you with, if you’re in saving money on your car insurance. Here are this weeks cheap car insurance tips:

Give EFT payments a chance!

We understand the appeal when it comes to mailing in your car insurance payments. It helps you readily balance your check book, you feel like you’re more in control, and it just seems like less of a hassle. In actuality, it’s not a productive way to pay ANY bill, far less, your car insurance bill.

Some companies actually charge for this method of payment, and while it may seem like just five dollars, that’s five dollars of your money that could be better utilized. Check for your provider’s online payment platform options, and investigate their EFT options.

Electronic funds transferal makes payments clean and automatic, freeing up your time and in some cases your cash flow. If you choose to have your car insurance payment deducted from your credit card, if means your actual cash-in-hand is available to you for other important things. EFT payments are also an easier way for car insurance companies to determine your level of commitment or ability to commit to the policy.

Times change, circumstances change, and when you were initially assessed when procuring your car insurance, you may have been considered low-risk.

If things have changed since then, or you miss a couple consecutive payments, you could be revaluated as high-risk. Essentially having an active, validated credit card on file means that your payments will be processed and more importantly, you have a pre-established ability to pay consistently.

Thinking of renting? You may just be able to forego that bit of coverage!

Sure you’ve got yourself a brand new whip and you’ve gone ahead and invested in comprehensive and collision coverage (as well you should for a more valuable vehicle). But there may come that inevitable time when your lifestyle finds you in a position that requires that you rent a vehicle. Luckily, many car insurance companies offer extended coverage to rental vehicles, if the policyholder has comprehensive and collision coverage on their newer/more valuable personal vehicle.

This is an excellent way to save on what can often be a bit of a nagging cost. This particular tip isn’t something that any and everyone can benefit from. We’ve specified newer-car owners or those who have more expensive cars on their policy.

These cars usually require more insurance considerations, and a moderate benefit of said considerations is that certain car insurance companies will cover rental insurance as well. if your car’s more worse for wear and less valuable by comparison, you should go ahead and fork out the extra for rental insurance.

Do you have car insurance questions that we haven’t already covered in this or our previous posts? Feel free to post a comment, and we’ll be sure to provide you with direction to the most appropriate resources. In the mean time, read this week’s post and keep the info in mind!


Why Should You Get Your Motor Vehicle Insured

In Mumbai alone the vehicular population has increased by 55% in the last seven years, now sporting 23.3 lakh registered vehicles.  The consequential congestion on the road, coupled with cows, stray dogs, disastrous rains, cyclists, pedestrians, absence of traffic rules, is bound to turn a sane human being to an insane driver, like

The Impatient Speeder

Dont be uninsured

The Honking Abuser

honking abuser

The Overcautious Snail

overcautious snail

he I Hate Rules Jerk

i hate rules jerk

As a result, India at present has the highest number of road accidents in the world. At such a rate, do you think you can get by with no or low insurance covers? Yes, but heavy fines  or a stint in jail with the former and ridiculously low claims with the latter.  So instead of trying to “save money” on your insurance premiums, it is wise to go  with a plan which covers at the following.

What to look for while choosing a good motor Insurance Policy

It is Mandatory to get at least a third party cover for all motor vehicle insurance in India. But that can protect you only to a certain level- when a damage is caused to another person’s party because of you. Then what about covering your own vehicle? Well, with a little more thought and price, you can get a comprehensive cover which will include your vehicle, a personal accident cover and a third party liability cover.

edited-flowchartUnderstanding the terms

Comprehensive policy:  It is a complete package policy wherein own vehicle damages will be covered up to the Insured Declared value. And any third party property damage or third party injury/death can be covered.

Third Party Liability- This cover protects you from any liability arising of third party bodily injury or death and third party property damage (TPPD).  This is a mandatory requirement under the motor vehicles act 1988. The limit for TPPD is 750k.  Also the Third Party Liability cover is unlimited and is determined by the court.

So it is a no brainer, that to get a sufficient and secure claim, it is wiser to go with the Comprehensive policy covering both.

Learn how to determine the premium you should pay for your vehicle.

Happy Driving 🙂

Source from:

Why should you choose insurance over warranty?


We all are fascinated about the concept of extended warranty with the purchase of a product be it an electronic item or a car. And we have to admit that we are often tempted by the offer. But how many of us actually stop to consider an extended warranty and differentiate it from other product that helps mitigate risk at a cost, like an insurance cover. When you buy a new car you receive a warranty from the manufacturer that the car is made available to you in a perfect condition. What we forget is that an unconditional warranty is embodied in the Sale of Goods Act, 1930. Which means this warranty should be applicable through a time period generally accepted as the lifetime of the car.

If it’s breached then we have the right to have the manufacturer either replace or repair a particular part or the product itself. Besides, let’s not forget that the customer can always approach the consumer court for relief in all such circumstances. However, the extended warranty often sold, generally claims to cover limited items like defects in the product, malfunction, accidental damage or in some cases it could be an all risk cover but always for a limited period of time. However, the question here is whether extended warranties adhere to the rules set by the Sale of Goods Act? The question is intriguing because the two concepts (warranty and car insurance) seem very similar but are distinct at the same time from each other.

The article will gives you insights on what is warranty and insurance? A warranty, is essentially an assurance to another person with certain conditions which if not fulfilled couldn’t claim for damages. A car insurance contract on the other hand is simply a contract where for a specified consideration, one party undertakes to compensate the other for loss relating to particular subject such as third party damages, damage to own car, accidental coverage due to natural calamities, stealing, burglary etc.

While having a closer look at the insurance policy and warranty, we can see that insurance effectively provides cover for practically every eventuality, whereas the warranty and an extended warranty, with all their limitations and exclusions, may not.

A car insurance contract is a contingent contract. A contingent contract is a contract in which promise is conditional and the contract shall be perform only on the happening or not happening of some future uncertain events. Essentially, the car insurance provider promises to save the subscriber from loss caused due to risks listed in the insurance policy.

However, the challenge is that though extended warranties seem like distinct concepts, they exhibit all the characteristics of an insurance contract and those who offer them argue to treat them as warranties portraying an edge over insurance. This means that despite the insurance sector being highly regulated, extended warranties escape the applicability of stringent insurance regulations entirely and are fed into the minds of people for purchase.

So, next time when you have to choose between warranty and insurance, stop thinking that warranty offers more than what car insurance provides. Infact, risk covering car insurances would be more economical and useful to customers than an extended warranty. Insurance is a regulated product and easier to claim; and the high cost of extended warranties is disproportionate to the risk it covers.


The Advantages of Car Insurance


Choosing auto insurance is taking more benefit and it is a good idea for you. You can take a lot of advantages to have auto insurance. let me see what decision for you after looking the advantages of auto insurance.

Financed Cars

First of the advantages of auto insurance, You have a new car that you must paid off. But if there is something happens to the car, what will you do to repair it while the car hasn’t been paid off. The car insurance is the best way for you.

Who It Covers

Second of the advantages of auto insurance, Full coverage insurance will cover all drivers who are legally allowed to drive while in your car. If you loan your car to a relative, or even if it’s taken without your permission, the insurance is still on the car. Liability policies usually cover any driver who has permission, but may require you exclude some drivers. Examples of this could be if you have a younger sibling living at home, you may be required to exclude that person from the policy. So if your teenage brother takes your car one night and something happens, it may not be covered with liability only insurance policies.

Car Rental Services

Third of the advantages of auto insurance, Many insurance companies will provide a complementary rental or loaner car if your car is expected to take more than 24 hours to repair providing you have full coverage insurance. This can be a great benefit. You don’t have to pay out of pocket for transportation to work and other errands while you wait on your car to be repaired. With liability insurance this may be offered at an additional fee, but is rarely, if ever, included with your liability plan.

Benefits Up Front

Fourth of the advantages of auto insurance, With some insurance plans, full coverage policies will pay you up front for the repairs that need to be done. Often they will send payment directly to the repair shop so you don’t have to worry about whether or not you will have the money to pay them. With liability insurance any repairs that are covered are usually reimbursed. This means you have to pay up front most of the time out of your pocket and wait for the insurance company to cut you a check.

Insurance Investment

The last of the advantages of auto insurance, Car insurance can be a good investment vehicle. If you think to save money while protecting your assets, insurance can be a very appropriate choice. Is not it nice to have all the means that can include multiple goals at once?

Source from:

How to Compare Car Insurance Rates Effectively?

Looking for cars

“It’s not just a car it’s your Carnama”, one of the beautiful milestone that you have achieved in life today. Will you not save your milestone from unnecessary damages, threats or accidental mishaps? Well we’re sure you would like to save it. The remedy for all your concern would be buying a suitable car insurance coverage for your vehicle.

Today, markets are flooded with car insurance policies lower or high rates, features filled or benefits oriented but “one-size-fits-all” are not the solution for cars. Every individual, every car, every condition is different therefore a car insurance policy has to be designed depending on individual needs, income source and car safety elements. It is advisable to have a suitable car insurance comparison on elements like rates, benefits and features, safety aspects, discounts and promotions activities, flexible payment modes and claim procedure before reaching for any consensus for car insurance purchase.

If you’re not sure how to compare car insurance rates, we’ve got handful of tips that may just save you some bucks on insurance purchase.


Today car insurance market is incredibly competitive and vast, insurance providers often go that extra mile to get your business. So, if you carefully compare quotes from different insurance provider you could make the competition work to your advantage. Therefore, your first step should be getting atleast three to four quotes from reputable car insurance providers. Once you’ve done that, look at each of them carefully to make sure you’re comparing apples to apples. This will help you determine which one will give you the best coverage for your buck.

Limit of liability coverage

Liability insurance often pays for the car repair and medical bills of another driver if you’re involved in an accident and found to be at fault. Although the law expects to have a minimum insurance requirements but this coverage might not be sufficient in the event of a worst-case scenario. All insurance quotes don’t come with matching limits of coverage. Therefore, it’s necessary to compare these quotes to determine the limit of liability coverage for each of the chosen options. At times, it can happen that the cheapest car insurance quote might have the lowest limit of liability insurance, which in reality may not be high enough to cover accident-related damages. So, just consider these options while having car insurance comparison.


Collision or comprehensive insurance pays for damages to your vehicle. Most policies will pay to repair or replace a vehicle up to its actual cash value. But, generally difference between policies is the deductible, or the amount of money you need to pay out of pocket in the event of a claim before the insurance policy kicks in and pays for damages. A policy with a higher deductible will often have lower premium rates, but if you make a claim, you will have to pay more out of pocket compared to keeping lower deductible. While having car insurance comparison make sure that the policies you are looking at have the same deductible in order to make an accurate comparison.

Get motorist insured

Insured motorist’s coverage helps you get the cover if you’re involved in an accident with someone without insurance. Else you could end up covering the damages you’ve suffered causing a big hole in your pockets. Although, it doesn’t come standard with all insurance policies, but it’s worth consideration.

Discount Eligibility

If you’re a safe driver, or if your car has safety measure, lesser miles covered, No claims, particular credit/debit card holder, or festive offers you will be able to get some form of car insurance discounts. Make sure to find out about any discounts you may be able to receive, and bank upon when having a suitable car insurance comparison. It’s only when you step down into the water you’ll understand the depth of it. Car insurance sector is also vast. By mere admiring the policy from above and assuming its good is not enough. You need to step down in water of quotes comparison and then carefully choose your options. It’s easy to arrive at the assumption that the cheapest policy is the best policy, but that’s not always the case. Sometimes the low cost insurance also offers the lowest limits of coverage. Low rate is not always “THE BEST” insurance quote for car insurance.

Advice On steps For Buying Car Insurance Online

Finding the cheapest auto insurance policy can be a complicated process, particularly if you plan on analyzing all the available policies in detail so as to see which ones offers you the best value at the lowest rate. Luckily, there are many online insurance quotation resources that can make the research and analysis of insurance policies much easier.

These online car insurance resources enable you to analyze many auto insurance policies and rates at the same time. On top of that some of these online resources are also affiliated with many insurance companies, thus giving you the opportunity to put your application in for any particular policy cover.

The process is quite simple. There are a number of car insurance quote generators online, and each one of them has a near identical process on how a prospective policy holder can submit their personal details and requests for a quote. Your personal details may include your postal code information, car model, registration details and your personal driving history. With this information these Internet quote generators will then process your data by running it through multiple insurance companies so as to receive multiple quotations from many insurers which the search/quote generator will then present to you as all your possible available options. Operation wise, most of this websites will send you an email notification. Or you may receive an instant quote in a popup window online whenever they find a new insurance quote result that they have found based on the information you provided and your specific auto insurance search query.

Once you have all the car insurance quotes, you will be in a position to view all the options from each provider. You can immediately pick a policy or cover which will linked you to the insurance company’s website to complete the remainder of your application.

Tips for getting cheap car insurance-

There aren’t that many cheap car insurance policies out there that are for real. If you happen to stumble across one, and you can’t find anything the matter with the package, hold on to it for all you are worth. It may be the best thing that ever happened to you.

Cheap car insurance is priceless and not that easy to come about. However, if you are meticulous about it, you should be able to find one online. I mean, with all the vast resources of the internet at your disposal, it is certainly a sure-fire way to get what you must have.

If you are able to maintain a credible credit history, you should have no trouble finding car insurance that is cheap. Often, these companies like to deal with people who are good for their money. One look at your history ought to convince them if you are for real.

Do not let anything keep you from receiving the cheapest car insurance you can get. All over the internet, such opportunities are all over the place and they are very encouraging. But if you do not qualify, you will not get lucky. You need to start looking into the criteria that meet the requirements for cheap car insurance, so that you can get it yourself.