For 1099 contractors & freelancers
No, the car payment itself isn’t deductible. Instead, deduct business driving with the standard mileage rate or your actual vehicle costs.
Schedule C, line 9 (Car and truck expenses), using one of two methods.
Standard mileage method: multiply your business miles by the IRS rate. For 2026 that’s 72.5¢ per mile for January–June and 76¢ for July–December. Parking and tolls are added on top.
Actual expense method: deduct the business-use percentage of gas, insurance, repairs, registration, lease payments, and the interest part of a loan, plus depreciation of the car.
Loan principal is never deductible, because it pays for the car, which is recovered through depreciation. Commuting from home to a regular workplace doesn’t count as business miles.
A mileage log with dates, destinations, purpose, and miles. For actual expenses, also the receipts.
In Smart Deductions, this is suggested as Car & Truck (Schedule C line 9). You confirm it before it counts.
Sources
General information, not tax advice. For your specific situation, check with a CPA or Enrolled Agent.