Contemporaneous Mileage Log Book
No Mileage Log Book = Lost Tax Deduction
Business owners who use a vehicle in their business are required by the IRS (and the courts) to substantiate their vehicular mileage by maintaining a contemporaneous mileage log book. The taxpayer’s log book is required to show:
- Odometer reading as of January 1 of the calendar year;
- Odometer reading as of December 31 of the calendar year;
- Dates of vehicle repairs and the mileage;
- Description of business trip showing date of trip, trip mileage, business purpose, person(s) involved; trip destination
And if audited by the IRS, the taxpayer will be requested to provide all repair and maintenance invoices and a business calendar that shows all business appointments.
Here is some good news . . . all is not lost.
TAX PLANNING TIP #1: Rather than complain about how onerous it is to maintain a mileage log book, or how difficult it is to find the time to maintain this log book on a current basis, consider investing in a mileage tracking app. One of the popular apps is MileIQ which both Android and IPhones are compatible. This app, if used properly, will reportably provide the taxpayer with the required IRS information to support the vehicle tax deduction.
TAX PLANNING TIP #2: If you did not maintain a log book throughout the tax year and are attempting to recreate it, first refer to Tax Planning Tip #1 so that this “recreating a log book” does not become an annual event. Then, immediately contact CarFax and request your vehicle’s history report. Some auto dealers and auto maintenance and repair shops are members of the “myCarfax member shops”. If your shop is a member, you will at least have the dates and mileage for the times that you had repair or maintenance work done on your vehicle. All that is needed to obtain this report is your vehicle’s VIN OR its license plate number and state of registration. You do not have to be a member of Carfax to obtain this report, although a small fee may be required.
If you would like to discuss your business or personal tax planning, tax preparation and other financial concerns with an experienced tax professional, we invite you to call 610-594-2601 today to make an appointment at our Exton PA CPA office to discuss your situation. You can also schedule a consultation at Click Here.
Copyright © 2019 Keystone Financial Solutions, Inc. All rights reserved. BE SURE TO READ THE DISCLAIMER PAGE: Content in this blog is for educational purposes only and should not be considered as the rendering of tax, legal or investment advice. The publisher of this blog makes no representations as to the accuracy or completeness of any information herein, will not be liable for any errors or omissions, and shall not assume liability for any losses, injuries, or damages from the display or use of this information.
About F. Bryan Haarlander, EA, CTRS:
Bryan Haarlander is an IRS licensed Enrolled Agent and who owns and operates a specialized tax services firm serving clients in the western suburbs of Philadelphia, PA, which includes the cities of Chester Springs, Coatesville, Collegeville, Devon, Downingtown, Exton, Frazer, King of Prussia, Paoli, Philadelphia, Phoenixville, Pottstown, Radnor, Reading, Wayne, West Chester in Berks, Chester, Delaware, Montgomery and Philadelphia Counties, as well as clients in Delaware, New Jersey, New York and throughout the continental USA.
A Certified Tax Resolution Specialist, Bryan is well-known for his IRS tax resolution expertise and his book How to Resolve Your IRS Tax Debt Problems.