Six
Reasons to Keep a Mileage Log
Free Gas!
If your vehicle gets
18MPG, then the 2008 IRS standard mileage deduction of 50.5 cents/mile will
give you $9 in tax deductions for every gallon of gas you buy!
(Just muliply 18 miles/gallon times 0.505 dollars/mile!) This
means that at even the lowest combined Federal and State tax the IRS is paying
for your gas! All you need for
this free gas is an IRS conforming mileage log!
The IRS is Cracking Down
The days of the
‘softer, kinder IRS’ are over; they have realized that this approach has
resulted in taxpayers becoming lax in their record keeping.
They are hiring thousands of new agents to remedy this situation.
The IRS is also realizing that it is much easier to send out 1000 form
letters to small business owners asking for their mileage logs than to attack a
large corporation and their army of lawyers.
Audit Flags for Small Business
Owners
Even if Actual
Expenses are taken for a vehicle, a mileage log is required if that vehicle is
driven for any amount of personal use.
What this typically means is that specialty vehicles like dump trucks or well
drilling rigs do not need mileage logs, but if you have a passenger vehicle,
then it can be more difficult to convince the IRS you never drive it for
personal use. If you have one
vehicle per family member, then convincing the IRS you walk or are driven to
every non-business activity is impossible.
New IRS Ruling in 2004
A new IRS ruling in
2004 allows you to use up to 4 automobiles simultaneously and still be eligible
for the Standard Mileage Deduction. In the past, the‘accepted’
advice has been to have only one vehicle for each activity because it is
difficult to prove they were never used at the same time.
This new ruling makes keeping a mileage log more complicated, but it
also gives you more opportunity to get every deduction you are entitled
to.
Mileage Deductions are not just for
Businesses
Itemized deductions
for 2005 can be taken for volunteer driving for a non-profit organizations,
un-reimbursed employee driving, job search/moving, and medical driving such as
going to the grocery store for cough medicine.
MileageWiz™
Makes Creating a Mileage Log Incredibly Easy
Most small business
owners do not have the time to keep up with their mileage log. Some want to log
throughout the year while others want to create a log at end of the year and
preferably in as little time as possible.
All of these people
have been in need of a flexible solution that supports both ends of this
spectrum and all points in between.
MileageWiz not only gives complete flexibility in how the mileage log is
created, but accelerates the process to 1/10 the time and effort of traditional
methods. It works for multiple
businesses and vehicles and is structured to encourage you to take all the
deductions you are entitled to including non-business driving (as mentioned
above).
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