When you’re constantly in your car for work — going to and from client meetings, out-of-the-office consultations and the occasional trip out of town — keeping track of the miles you spend on the road can be challenging. But for those who are self-employed, keeping diligent records of these work-related rides could mean hundreds or thousands of dollars in savings a year, as the IRS mileage rates are 54 cents per mile for business miles driven. In 2017 this will change to 53.5 cents per mile.
Using a mileage tracking app makes it easy to keep an accurate record of time spent on the road so you can confidently deduct these expenses when you file your taxes. Here’s what you need to know.
All the Ways You Benefit by Tracking Your Mileage with an App
While miles may be deducted as an expense, the full cost of operating your vehicle during business may also be deducted, The Balance reports. To do this, you’ll need to save receipts for items such as oil changes, insurance, repairs, etc., to include in your return. Using a mileage tracking app that also has a receipt capture feature, like the QuickBooks Self-Employed app, allows you to use one device to easily monitor all your vehicle usage.
Business mileage tracking will vary slightly depending on the type of employment you have. For example, if you are self-employed, you can deduct mileage when meeting with various clients and even when doing pro bono or charity work. You can also deduct any business miles — driving that takes place only for business — driven from home if you you have home office. Small business owners or employees of a company, on the other hand, won’t be able to deduct miles driven from home to the office and back.