Small Business Tips

Reporting Business Mileage on Your Tax Return

Marin Perez

We often talk about tracking your mileage and expenses for tax purposes. But, what are you supposed to do with it?

Let's go over the basics of reporting business mileage on your tax return.

Reporting business mileage for taxes

If, like many self-employed workers, you are a sole proprietor, your business income and business deductions will be reported using the IRS Schedule C, Profit or Loss From Business along with your personal tax return.

Line 9 will contain the category for car and truck expenses. Because many people try to abuse this deduction, the IRS requires more details.

For business mileage on your Schedule C, the IRS wants to know:

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  • The date you placed your car in service for business purposes
  • Total business miles you drove during the year
  • The total commuting miles you had during the year
  • The total miles you drove when you weren't on business or commuting
  • Was your vehicle available for personal use during off-duty hours?
  • Do you (or your spouse) have another vehicle for personal use?
  • Is there evidence to support this deduction?
  • If yes, is the evidence written?

What does the IRS require for business mileage deductions?

You can satisfy that last requirement by making sure you're keeping an accurate mileage log. The IRS doesn't require you to submit the mileage log with your return to get the deduction, though.

Instead, you'll need the mileage log book in case you get audited down the road‚ that's why it's a good idea to keep your mileage logs for at least five years. The IRS requires your mileage log includes a record of:

  • Your mileage
  • Dates of your business trips
  • Places you drove for business
  • Business purpose for your trips

You'll also want to log your business vehicle's starting odometer reading. You only need the starting reading, though. The IRS does not require you to log your odometer reading for every business trip during the year.

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