The question of how to claim mileage on your taxes is a major concern for many taxpayers, primarily charity workers and those who are self-employed. Whether you're working in commission-only sales or moving to a new home, there are many avenues available to write off the costs of driving your car. This guide will explain the basics of how to take advantage of mileage deductions.
What you will need:
- All of your gasoline purchase receipts
- A written or automated mileage log system
- Knowledge of the IRS rates and rules regarding mileage deductions
- A spreadsheet application
- Keep track of your gasoline purchases. Under certain circumstances, factoring in the cost of gasoline is one way you can claim mileage expenses on your taxes. When filling up at the gasoline station, obtain and keep your receipts. This is where a spreadsheet application will come in handy, as you can accurately record the time, date, place and amount of money you spent.
- Maintain a mileage log. To claim mileage expenses you will need to keep track of the miles you spend driving for business and other deductible trips. The IRS strongly favors written records. At the very least, you should reset your trip meter on your vehicle's odometer for each deductible trip and record your mileage on paper, or electronically. There are a variety of GPS-based mileage log devices that you can also use to accurately automate this process.
- Study the IRS laws regarding mileage deductions. The IRS rules regarding how to claim mileage on your taxes are quite complex. Also, their deduction rates change every year, typically keeping proportional to the rising or falling cost of gasoline.
- It is highly advisable to look over the IRS website for extensive information about how to claim mileage on your taxes. It may even be advisable to consult a tax professional.