Estimated tax tip savings. Absent detailed records, the IRS will disallow your mileage deductions. Learn how to avoid Mr. Royster’s mileage log problem that cost him $14,000 in auto expenses—and probably worse yet, cost him a ton of time trying to defend those deductions both in an IRS audit and before the court.
The IRS is particular about mileage deductions, and taxpayers can satisfy its strict requirements only by producing very detailed accounts of their travel, such as a well-notated diary or logbook. Unfortunately, this work is tedious and time-consuming. It doesn’t matter that you’re running late or that it’s too much of a hassle or that you forgot to write it down on Tuesday and now it’s two Sundays later and you can’t remember each stop you made.
If you want your mileage deduction to survive an audit, you have to produce precise, accurate records. Until recently, to do that properly you had to frequently interrupt your busy schedule to scribble the details of four key travel-related pieces of information.
Here’s the good news: Today you can enlist the help of some automated alternatives that make record keeping for business vehicle use a snap.
Here’s everything you need to know about what to track and the latest, easiest ways to simplify it. First, to prove you’re entitled to a mileage deduction, for each trip you need complete and clear records of ... Log in to view full article.