How to keep an IRS-compliant mileage log for taxes
Keeping a compliant mileage log for taxes can be the difference between you ensuring you receive the maximum deduction for your mileage, or missing out on the amount you are entitled to, and in some situations even facing an IRS audit.
If you sometimes use your car to meet a client, go to a conference, get supplies for your office or similar, then you would likely be able to get a deduction for those trips at tax time.
This is where a mileage log book comes in and helps you get the deduction you are entitled to.
What is a mileage log book?
A mileage log book is a record you keep for tracking distances traveled for work purposes. A logbook can help you deduct expenses from your tax payments, whether you are self-employed, an employee, or own a small business.
Why should I keep a mileage log for taxes?
If you don't have a mileage log book and the IRS audits you, the authority may reject your claims for automobile vehicle costs. You can ensure that the IRS has no excuse not to reimburse you the amount you are entitled to by following our mileage log advice. According to the IRS, keeping a mileage log book is the most effective way to ensure that you have proof in the event of an audit.
What to record in your mileage log book
Regardless of your employment situation, you will almost certainly have to keep track of the following:
- total mileage for the year
- odometer readings at the start and end of the year
- mileage for each business trip
- Time of the drip (the day will suffice)
- place (your destination)
- Purpose of the trip
It is also necessary that the record be kept up to date. This implies that it must be completed at or near the time of departure. Anything that is updated once a week is generally considered sufficient.
Read more in-depth about mileage log requirements in the US.
Where to buy a mileage log for your taxes
You can buy a regular mileage log book either online or at most office supply shops for as little as $5. However, it is not necessary for you to buy a logbook as you can use an Excel, PDF, spreadsheet, or a free mileage log book app. Nowadays, it is becoming more common for people to log their trips digitally in order to avoid losing data and make sure they are compliant with IRS requirements.
A Spreadsheet log book is an excellent choice as it will allow you to keep your data safely stored online and will save you time compared to the regular physical log book. However, there is still a lot of manual work involved, as you must log the data yourself and make sure you have tracked the correct mileage for each trip. You can check out our free mileage log template to see if it is the right fit for you.
A mileage logging/tracking app is a common solution nowadays since it is the most time-efficient. By using an application, you can automatically track your trips and have your data ready for you. How it works is that after you have logged a couple of your trips, you only have to go to the app and confirm which was a business trip and which one was personal. Then, at the click of a button, the app will generate a report that you can send over directly to your employer or accountant.
Tips for keeping a mileage log for taxes
- Don't skip a day - if you want to be sure that all of your logs are correct, you should verify every day if you have properly logged or tracked your trips.
- Instead of using a printable mileage log or a physical log book, use a logbook app to save time.
- Always log personal trips too - you need to be able to show the percentage of business trips out of all your trips.
- Keep your logs for at least 3-4 years so that you are able to provide proof in case of an audit.
- Don't be afraid to inquire! If there's something you're not sure about, ask someone who does, such as an accountant or a tax advisor.
Check out our updated IRS mileage guide for additional information on how to keep a mileage log for taxes and all IRS regulations for 2021 and 2022. If you are located in California, you should also check our dedicated article to California mileage reimbursement.
Keep in mind that this is a general overview of how to keep a mileage log book. The information here should be supplemented with information from your accountant, employer and the official IRS website.
- Self-Employed Tax Deductions
- Employees’ Guide to Car Allowance
- Free printable IRS mileage log template - PDF, Excel and Sheets versions
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