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I got audited for 2014 and 2015. For my miles I had hand written logs with total miles, cities I drove to, and a few names of people I met with each day I drove.
Everything was A ok with the IRS.
I get audited more then Donald Trump and use a similar method of proving my mileage. Never even raises an eyebrow.
Funny thing is, when you get the dreaded letter saying your under audit it says the issue they want to review them explains each. On mileage it says "if you didn't keep a record recreate your mileage or bring appointment books, maintenance records ECT" So all this tracking is really not required. I am not suggesting not to teach milage tho
Just curious how everybody here is tracking their miles. Paper? An app? A spreadsheet?
You need to track the destination and business purpose of your trips. Does this mean you track every trip you take during the day. Say five different trips for five different appointments? Or do you just track the total miles per day?
Is it true that every single mile for business purposes (ie driving to a leads town) is worth $.535?
Suppose you drive 1000 miles a week 52 weeks a year for 52,000 miles. Thats 52,000 * .$535 = $27,820. Let's say you made $100,000 in profit that year. Would you deduct $27,820 from $100k and be taxed as if you earned $72,180 that year? Or would you deduct the $27820 from your entire tax bill? (I assume it's the former, because the latter sounds too good to be true.)
By far the best way to prove to the IRS how much you drove for business is to keep contemporaneous records. “Contemporaneous” means your records are created each day you drive for business, or soon thereafter.
A mileage tracker app like MileIQ may be one of the easiest ways to provide what the IRS wants. It automatically tracks, logs and calculate your mileage for each trip. It can also provide a mileage log that can stand up to IRS scrutiny.