It’s quite easy to get confused and overwhelmed by all the requirements when it comes to mileage log for taxes if you are self-employed or own a small business. What are IRS mileage log requirements? Can you track mileage on the go? Read the article to find out how to succeed in tracking miles for taxes.
IRS mileage log requirements
Make sure you maintain a mileage log for taxes in accordance with the IRS requirements by reviewing the following points for each trip:
- the mileage
- the total miles you have driven
- information such as date, location, destination
- purpose (personal trips or business trips)
- odometer readings – year-end and start-of-year
Tracking mileage for taxes can be done in two ways, depending on the method of calculation you choose, but you have to keep in mind that you can only change the method the next year.
The first way is to standard mileage rate, which in 2022 is 58.5 or 62.5 cents per mile driven. In this case, you need to keep records of all the above details.
It’s also possible to use the actual expenses method, in which you need to provide the IRS with all receipts showing the vehicle-related expenses. They can either be fixed (e.g. registration fees) or variable (e.g. gas price).
To make it easier to understand what may be the subject of mileage reimbursement, it may be quite handy to look at some real-world examples.
If you are self-employed and have to commute to and from work, log the journey as personal in mileage log. However, all your trips to your clients, even if you arranged lunch with them, are considered to be business-related.
A person who drives a company car for a company, may get 58.5 cents for driving within your city, and 62.5 for driving outside. If the fixed costs are covered by the employer, the rate per mile is lower. The mileage reimbursement from her employer is tax-free.
Another case is driving a personal car for work, which is also qualified for the vehicle mileage log.
Can I track mileage on the go?
It is not possible to track mileage on the go when doing a simple mileage log manually. It’s quite the opposite with mileage tracker apps. It allows you to track the drivers, with the movement monitored at the point of the arrival. It makes it possible to recreate the movement of the car track, which is a solution for those who tend to miss logs. No more gaps, no more wasted time to recreate the journey.
If you want to get the best app to keep track of mileage, with the most number of functions for a mileage log, you should definitely choose MileageWise. It’s suited for the self-employed, as well as tax professionals. It’s the solution for creating IRS-compliant mileage logs, which corrects logical conflicts in the mileage log, and also offers a mileage log template for the traditional solutions lovers.