FAQ: What is the easiest way to track my business mileage?

Tracking business mileage is a crucial task for small business owners who want to maximize their tax deductions. The IRS allows you to deduct either the actual expenses of using a vehicle for business or the standard mileage rate, but to take advantage of these deductions, you need accurate records. Fortunately, tracking business mileage has become easier than ever with the help of modern technology. Here’s the easiest way to stay on top of your mileage tracking without the hassle.

Why Tracking Business Mileage Matters

Before diving into the easiest methods, it’s important to understand why tracking mileage is so essential. The IRS allows you to deduct a certain amount per mile driven for business purposes. For 2024, the standard mileage rate is 67 cents per mile. Over the course of a year, these deductions can add up significantly, reducing your taxable income and saving you money.

However, to claim these deductions, the IRS requires detailed records of your business-related driving. You’ll need to document the date, starting location, destination, purpose of the trip, and total miles driven. Without accurate records, you could lose out on valuable deductions or face issues during an audit.

The Easiest Way: Mileage Tracking Apps

The simplest and most efficient way to track business mileage is by using a mileage tracking app. These apps automatically record your trips using GPS technology, eliminating the need for manual entry and ensuring accurate records. Here are some of the most popular mileage tracking apps for small business owners:

1. MileIQ: MileIQ is one of the most widely used mileage tracking apps. It automatically logs your trips in the background and allows you to categorize them as business or personal with a simple swipe. The app also provides detailed reports that are IRS-compliant, making tax time a breeze.
2. QuickBooks Self-Employed: If you’re already using QuickBooks for your accounting, the Self-Employed version includes a built-in mileage tracker. It automatically tracks your mileage and integrates seamlessly with your financial records, giving you a complete view of your business expenses.
3. Everlance: Everlance offers automatic trip detection, and it allows you to track both mileage and other business expenses in one app. You can generate IRS-compliant reports with ease, and the app also offers features like income tracking and receipt scanning.
4. TripLog: TripLog is another comprehensive mileage tracking app that offers automatic tracking, expense management, and customizable reports. It’s ideal for businesses with multiple vehicles, as it allows for fleet management.

Tips for Effective Mileage Tracking

• Be Consistent: Make sure to consistently track all business-related trips. Skipping trips or forgetting to log mileage can lead to inaccurate records and missed deductions.
• Review Regularly: Periodically review your mileage logs to ensure all trips are correctly categorized and documented. This will help you catch any errors before tax season.
• Keep a Backup: While apps are reliable, it’s always a good idea to keep a backup of your mileage records. Export reports and store them in a safe place, either digitally or in print.

Tracking business mileage doesn’t have to be a tedious task. With the help of modern mileage tracking apps, small business owners can easily log their trips, ensure accurate records, and maximize their tax deductions. By choosing the right app and staying consistent, you can simplify your record-keeping, save time, and focus on what matters most—growing your business. Contact your tax professional, or our office, if you have any other questions about tax deductions for your small business.