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Highly effective mileage log
7 Habits of Highly Effective Mileage Logs

7 Habits of Highly Effective Mileage Logs

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Know this; the difference between financial gain and loss lays beneath the surface of The Mileage Log. At first glance, this document seems ordinary in appearance; a simple document that on the surface lacks much value. 

Habit #1 – Accuracy

In my thirty-plus years in the financial industry, I have seen way too many taxpayers get burned in IRS examinations because they did not keep a timely and accurate mileage log.  A simple mileage log may be all you need.
 

Habit #2 – Know the Standard Mileage Rates

  • 2019 standard mileage rates are 58 cents per mile driven for business use
  • That’s up 3.5 cents from the rate for 2018
  • 20 cents per mile driven for medical or moving purposes
  • That’s up 2 cents from the rate for 2018
  • And 14 cents per mile driven in service of charitable organizations

Habit #3 – Proof of Mileage

Claiming vehicle expenses on your tax return? A simple mileage log is the one item that an IRS examiner will insist on seeing as your PROOF of business use for your vehicle.
NO MILEAGE LOG = NO AUTOMOBILE EXPENSE DEDUCTION (NOT EVEN THE COST OF OPERATING THE VEHICLE
 

Habit #4 & 5 – Seek Wise Counsel & Plan Well

Most IRS examiners are trained to Dig Deeper when people show up WITHOUT a Mileage Log.
No Mileage Log? You’ve just become a lamb, a lamb who is sitting across the table from a Wolf.
Be proactive in seeking the counsel of an expert tax advisor beforehand, so you can avoid heading down a troubled path with the IRS.

Habit #6 – Detailed Expense Records

Vehicle expenses on your tax return? IRS FORM 4652 has columns for answers to the following questions for up to six vehicles used by a sole proprietor, corporation, or partnership.
  • Evidence to support the business/Investment use of your vehicle
  • List total business miles on each vehicle
  • List total commenting miles on each vehicle
  • List total personal miles on each vehicle
  • Copies of repair receipts, inspection slips, records showing total mileage for the year
  • Copies of logbooks and other records to
  • support the business mileage claimed
  • Copy of your appointment book or calendar of business activities for the year
  • Copies of every paid bill, invoice and canceled check, including expenses for gas, oil, tires, repairs, insurance, interest, license plates, taxes, parking fees and tolls
  • Copy of the bill of sale or other verification to establish your basis in each vehicle, Including the trade in values on vehicles traded for your current ones being used
  • Copies of repair receipts, inspection slips and other records showing total mileage for the year
  • Copies of logbooks and other records to support the business mileage claimed
  • Copy of your appointment book or calendar of business activities for the year
  • Match the odometer readings with the listings in your mileage logbook
  • Compare the mileage between repair stops to see if that ties to your claimed mileage

Habit #7 – Tools to Make Life Easier

There are several tools that you can employ in your daily business activities that will make keeping a valid and useful mileage log to safeguard your deduction of your vehicle expenses. This is the best mileage app solution that I recommend to my clients.
  • My Trip Log https://triplogmileage.com/
  • A free downloadable app that uses the GPS on your smartphone to help you keep track of up to 6 vehicles daily mileage.
  • Paid Versions, only $2-$4 per month, come with custom tax compliant reports and other features
Borshoff Consulting, LLC offers tax consulting, as well as many tools and packages to help you run and grow your business while keeping up with the rules and regulations of taxing agencies and other regulatory entities. Have a trusted advisor on your side. One who is professional, responsive and delivers the highest quality of work on your behalf.
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