Keeping track of tax deductible miles

I got in my car for the first time in 2017 today. It also was my first use of my new mileage log.

Yep, that pretty little pink spiral notebook is this year's tracking device of all my potentially tax deductible miles.

And yep, those of you who know me know that I'm not really a pink kind of gal. This notebook was tucked in bag I got at a conference.

Over the years, I've attended a lot of conferences and gotten a whole lot of similar notebooks, so I use a new one each tax year.

What miles to log: Some years, they are filled to the final page with driving notations. Others have plenty of unmarked pages.

But all are as accurate as I can make them.

Such record keeping is key to claiming potential driving deductions for such things as:

• a business meeting with a client (part of your Schedule C expenses if you're a sole proprietor),
• delivering meals prepared by your local nonprofit food bank (as an itemized charitable deduction),
• going to a dental appointment (to help you hit the 10 percent threshold that now applies to all taxpayers regardless of age), or
• moving across the state for a new job (as an above-the-line deduction on Form 1040).

Note, too, the first entry on that page. It's what my odometer read before I pulled out of my driveway.

You need to know not just the specific miles for each possibly tax-deductible trip, but also how many overall miles you drive each year, especially when you use the same car for business and personal travel.

Also, you count the round trip mileage, which I acknowledge with my RT annotation. The Internal Revenue Service realizes that you've got to get back home!

Options for business miles: If you're deducting your business related miles, you have  a choice. You can claim either your actual auto business expenses or the standard mileage deduction rate.

The choice, like every other tax decision, depends on your personal situation.

You obviously want to use the one that will give you more tax savings. Unless, of course, convenience is more important to you. That's the motivation for a lot of filers, me included.

Lots of tracking options: Either way, you need to keep track of the miles you drive.

I know a lot of folks use a smartphone app to track their business travel. I love my phone and I use a lot of apps.

But for mileage, I'm more comfortable using the old fashioned handwritten option. With the notebook, I can add all sorts of notes, like who was at the business lunch, what we talked about and the name of the waiter at the restaurant who gave us such great service.

Make your own choice. And then keep up with your miles as you travel. It's easier than trying to recreate them months later at tax-filing time.

Plus, your contemporaneous mileage records will be much more convincing if the IRS ever questions your driving deductions.

 

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