How Important is it To Log Business Miles?

Are you a business owner? If so, are you logging your business miles? It is important to keep track of your business miles so you can save tax dollars and get the deduction for the miles put on your vehicle.

It is required by the IRS that you keep adequate records when you log your mileage. 

2012 Business Mileage Rates

• 55.5 cents per mile for business miles driven
• 23 cents per mile driven for medical or moving purposes
• 14 cents per mile driven in service of charitable organizations
  

Be sure you use the standard mileage rate for the year of your tax return, not the year you are working on your return.

To determine the amount of miles driven for business you need two numbers for each business vehicle:

1)    The total number of miles driven throughout the year

2)    The total number of miles driven only for business

Tracking your mileage:

·     Tracking your total mileage for the year is easy. Simply write down the mileage on your odometer on the day that you start using a vehicle for business and on the day the year ends.

·      Keep a notebook in your vehicle that you can easily access to record your mileage on each day.

·      If you’re using a vehicle for personal and business it is important to write down the mileage to and from the location that is business related. Be sure you include the purpose for the trip or errand.

·     Business miles are the number of miles actually driven for business, for example, to meet with a client.

·      Remember that any miles driven to the bank, to purchase supplies, computer store, or to meet with your accountant are also part of your mileage deduction.

It is important to remember that commuting is NOT deductible, but it is required on your tax return.

Keeping track of your business mileage is not that difficult. As time progresses it will become second nature to log your mileage. Professor Tax USA wants to help you get all the deductions you deserve. If you have any tax, bookkeeping or accounting questions, remember we are always here to help make running your business much easier.