If you have a car that you use for business purposes, you will quickly learn that the expense of driving a vehicle for your business can add up pretty quickly. Not only do you have to take into account the gas that you have to put in your car, but you also have to think about the every day wear and tear that you’re putting on the vehicle. This is why you can claim mileage when you’re using a vehicle for your business as a tax deduction. Mark Dicus & Company is here to talk about how you go about claiming mileage to take advantage of this tax deduction.
Standard Mileage Rate VS Actual Expenses
Any time you have a car that you use for business, you can deduct the mileage in one of two ways: standard mileage and actual expenses. It is important to understand the difference between these two ways of deducting mileage, and it also might be valuable to calculate your mileage both ways to see which one is more beneficial for you.
– Standard Mileage Deduction: When you are doing a standard mileage deduction, you are deducting a flat rate for every mile that you drive. In 2023, the standard mileage deduction rate is 65.5 cents per mile.
– Actual Expenses: If you are choosing to deduct the actual expenses of your vehicle, you will need to keep track of all car expenses which would include gas, oil changes, repairs, insurance, and depreciation. You will then deduct the portion of these expenses that apply to your business miles.
Important to Keep Records
If you were wanting to take advantage of business mileage deduction, it is vital that you keep records of your miles driven. You can keep records of your mileage in a few different ways. First, you can keep a notebook in your vehicle and log any miles that you drive for business. There are also apps that help you to track your business mileage. Some people also choose to reconstruct mileage from a logbook. Whichever approach you would like to take is fine, as long as you remember the importance of keeping record of your business miles.
It is a Good Idea to Keep Receipts
Whenever you have any parking fees or tolls that you have paid when you’re traveling for business, you should keep the receipts because these are also deductible. It should be noted that you can’t deduct any miles that are driven during a commute. Only miles driven for business can be deducted from your taxes.
Accounting, Auditing, Taxes & More in Summerlin, North LV, Henderson, Lone Mountain Village & Greater Las Vegas, Nevada
When it comes to calculating your business deductions, let Mark Dicus & Company do all the work for you. We will help you prepare your taxes to ensure you’re taking advantage of any and all deductions that are available to you. It is our goal to help you keep as much money in your pocket as possible. With our training and expertise, we will help you keep what is rightfully yours. Call us today!