Table of Contents
A mileage log template is the easiest way to keep record of your mileage for each trip you take. The IRS has been known to disqualify some deductions. This is because there wasn’t a clear separation among driving for business and other trips. Moreover, in your mileage log, you have to note when you started the drive and when you reached at the destination.
Components of a mileage log:
At the beginning of the year, along with a beginning record of the vehicle’s mileage, you also have a record at the end of the year too. Each day, this must match with the amounts that are recorded to make sure that the mileage is accurate. Each time when you start your drive to a destination associated with business, you must record the following information;
- The date of the business trip.
- Beginning point for the trip either it may be the office or a job site.
- The destination for your trip.
- The reason for your trip.
- Beginning mileage on the vehicle.
- Ending mileage for that trip.
- Tolls and other additional costs on the trip.
Each trip should be tracked as well as the beginning and ending mileage at the end of the day. You also have to make sure that they are precise. When you use this information for deductions, the IRS still requires that you keep these records on file for three years.
Mileage that doesn’t qualify:
When you have to commute from your home to your work location, the IRS takes it a personal expense. Your office or permanent place of business can be your that work location. A temporary location where you have to work at least one year is considered a place of business. The IRS doesn’t allow you to deduct that mileage.
Moreover, if they use their commuting time to make business calls or listen to business-related recordings then people believe that they can take the deduction. Such miles are still considered commuting and noted as personal expenses.
Mistakes people make:
You have to make the log in a batch for the whole month or year. The mileage log should be done on a daily basis. The IRS needs meticulous records and requires all the information listed above such as the date and reason for the trip and mileage information for each trip.
For each trip, when the IRS needs the reason then reason should accompany a name or business account. You have to include the name of the client in your log in order to claim to be reviewed a client’s account at his office. For missing or incorrect information, most business owners have been denied their deductions.
For business mileage expenses, there are two options for calculating deductions;
- The standard mileage deduction
- The actual expenses for the vehicle
You can add up the total miles per year that are driven for business for the standard mileage deduction. For each of those miles, you have to take a preset deduction. The deduction was 54 cents for each mile in 2016. You can’t involve repairs or maintenance to the vehicle by using this standard.
If you want to deduct actual expenses then you must have precise track of all maintenance and repairs done on the vehicle. For business, the percentage of mileage on the vehicle is deducted from the amount on your taxes.
Different types of business driving that qualify:
- Driving Between Offices or Work Sites
- Errands and Supply Stops
- Business Entertainment
- Airport Travel
- Unrelated Odd Jobs
- Temporary Job Sites
- Seeking New Employment
- Customer Visits
In conclusion, a mileage log template is the method of keeping record of mileage that contains the business trip at the time you take it within a logbook. Here, you have to include that where you are going and why; who you are meeting, and the location’s address.