The Internal Revenue Service announced its standard mileage rates for 2022 — How will it affect your deduction?
Some positive changes are in store for the 2022 tax year, which means it's time for all drivers to get informed on the IRS standard mileage rates for 2022. Below we’ve outlined some frequently asked questions regarding taxable mileage, including ways in which MileIQ can help you earn top dollar on your next tax return.
The IRS standard mileage rate is instrumental in calculating the deductible costs of operating a vehicle for business, charity, medical, or even moving purposes (only if you are an active and eligible military member). Taxpayers can thereby use these standardized rates to calculate exactly how much their mileage deduction is worth in the 2022 year.
The IRS standard mileage rates for 2022 are listed as followed:
In order to write off mileage in 2022, it is necessary to keep a detailed log of all miles traveled for business, charity, medical, or moving purposes. It might sound tedious at first, but there is an easy way to stay organized: download a mileage-tracking app. With MileIQ, your smartphone will use Wi-Fi, GPS, and mobile data to track your business miles and ancillary driving routes during the work week. Therefore, when the time comes to reimburse those yearly expenses, you’ll have a detailed log without ever thinking twice about where you went, on what day, and why.
In accordance with the tax reform bill of 2017, self-employed workers can still write off business miles in 2022, whereas W2 employees are no longer qualified to do so. What’s more, there is no set limit on how many miles you claim on your deduction as long as they are backed by sufficient records. Here are common instances when mileage deduction is warranted:
It’s important to note that any distance traveled, let’s say between your home and work, does not qualify as deductible miles. Consequently, you cannot use the IRS standard mileage rates for 2022 to leverage more miles than factual evidence proves. With the utility of a mile-tracking app, you can classify drives, manage location names, and make sure every mile is organized from time and date.
Here are MileIQ’s time-saving tips for mileage tracking: https://www.youtube.com/watch?v=6j0i3EZOnQg
Unfortunately, the decision to not maintain a yearly mileage log will reflect poorly on your deduction. It simply will make things harder to prove and in turn, leave you with less of a chance of earning top-dollar on your reimbursement. In most cases, you’ll be required to give an oral testimony and hand over any receipts, emails, or additional proof of travel during business hours to help justify a deduction without proper documentation.