Final answer:
In deciding between the actual expense method and the automatic mileage method, the cost of car insurance should indeed be considered. The statement provided is therefore false, as the actual expense method includes all costs of operating the vehicle, including insurance.
Step-by-step explanation:
When deciding between the actual expense method and the automatic mileage method for deducting car expenses on a tax return, one should consider the cost of insurance on the automobile. Therefore, the correct answer to the question is False. The actual expense method involves deducting the actual costs of operating the car for business purposes, which includes expenses such as gas, maintenance, depreciation, and insurance. In contrast, the standard mileage rate method allows taxpayers to deduct a set rate for each mile driven for business purposes, without accounting for the actual costs incurred, such as insurance. Taxpayers should compare both methods to determine which one provides the greater tax benefit.