Tracking Your Business Mileage

Do you use a vehicle for business purposes? If so, you may be missing out on an easy deduction on your income taxes. The IRS currently allows a deduction of 55.5 cents* per business mile driven. However, if you can’t prove it, you can’t claim it, so you must maintain a timely and accurate record of all miles driven.

Mileage tracking doesn’t have to be complicated. A simple log book can be purchased at any office supply store for two or three dollars, or a blank notebook can serve the same purpose. For those who prefer to maintain a log on the computer, it is easy to set up a spreadsheet in Excel. At a minimum, you want to record the date of travel, purpose, starting mileage, and ending mileage. You may wish to include amounts paid for parking or tolls. It is a good idea to also make note of your car’s odometer reading on January 1 and December 31 each year. This log should be filed with your other business receipts for audit purposes. 

A sample mileage log, freely available from www.microsoft.com

I currently use an app on my Android phone called “Trip Log – GPS Mileage Tracker,” which uses GPS tracking to calculate the miles I’ve driven. I can even pause GPS tracking during a trip. This is especially useful when I have multiple stops to make, not all of which are business-related. I can then email a monthly report to myself for my tax records.

In addition to business mileage, remember that miles driven for charitable organizations, medical purposes, or for moving are all expenses you can claim as deductions on your personal income tax return. 

No matter what method you use, maintaining a mileage log is a necessity if you plan to claim automobile expenses as a business deduction. It’s never too late to begin tracking. Once again, the mantra is, if you can’t prove it, you can’t claim it. Start today!

For more information, please refer to IRS Publication 463 or visit www.irs.gov.

*The IRS adjusts rates periodically. Please visit www.irs.gov for the most current standard mileage rate.