Taxes

If you have your own business or receive income reported on a form 1099 (Contractor) instead of a W-2 the you can file a schedule C (Self Employed) to report deductions of expenses incurred for this business.  If you take a straight mileage deduction (~$.50 / mile - changed mid-year 2008) you cannot deduct other expenses. 

If when you acquired the vehicle you chose to itemize all vehicular expenses for this vehicle then you could deduct those proportionately to the business use of the vehicle.    This is why leasing is somewhat popular for business vehicles but the record-keeping is more oneous.    Check to see if an H&R block tax course is offered in your area - You would learn much useful tax information.

Regarding the answer from EnergyFred... just an additional note...  if you are filing Schedule C, have chosen to deduct your actual operating expenses and not use the standard mileage rate and are preparing the taxes yourself... please be aware that you will be deducting the interest portion of the car payment (in the appropriate percentage relating to business vs personal miles driven) on the Schedule C.... but to "deduct" the principal amount of the car payment you must use Form 4562 (Depreciation) the first year that the vehicle is placed in use to figure the amount of deduction you take over the depreciable life of the vehicle.  The depreciable life of the vehicle is determined by which depreciation method you use and several other factors, NOT the actual life of the vehicle.  The principal amount that will be arrived at will be entered as depreciation expense on the Schedule C (again in the appropriate percentage of business vs personal miles) and will NOT be the same as the ACTUAL amount of principal you paid during the year.  The amount of depreciation to be claimed in subsequent years is predetermined the first year so after year one you just enter an amount on Schedule C and do not have to fill out Form 4562 unless you add a new asset in the later years.                      Be aware, if you have not used this vehicle in prior years.. you may find it easier to just use the standard mileage rate.  If you claim depreciation expense on the vehicle, when you sell it you may have to report any gain as income.  Also, be aware that the expenses included in standard mileage rate do NOT include tolls and parking fees... these are claimed in addition to standard mileage rate.                AND... beware of H&R Block or Jackson Hewitt (etc) classes.  As a tax return preparer.. I have seen many many returns prepared by these companies that were grossly inaccurate and extremely costly.  These preparers receive a short education, just enough to prepare extremely simple returns then they are turned loose on the public.  One Jackson Hewitt preparer used the standard mileage rate for an automobile for miles driven by an over the road trucker in a semi..... plates alone are $3000 not to mention the $6500 he paid for a new set of tires... and at 5 1/2 miles to the gallon of diesel fuel.... all at a rate of about $0.36 per mile (this was several years ago)  His tax bill was $19,000.00 higher than it would have been if the actual expense had been deducted.  He didn't know the return was improperly prepared until he came to me three years later.  By then he had lost his house to foreclosure and gone thru a divorce due to the financial pressure of trying to pay the IRS.  This is a true story, sad, but true.  Be careful.  You need someone with more than a few weeks training for anything but the simplest return.