Sunday, April 4, 2010

Tips to Tracking and Calculating your business Mileage

Documenting Mileage is a big Deal according to the IRS. If you do not have accurate and proper documentation the IRS will disallow the deduction.
Auto loan Calculator
Quick Techniques to make sure you have everything you need for your Mileage deduction:

* Keep a mileage log. In each vehicle at all times. ( a calendar with boxes for each day is perfect) Say, Toni House CEO First Tax Solution LLC

* Write your beginning Odometer reading on the applicable day and where you are going and the ending Odometer when the day is finished

* Calculate your personal Mileage and business Mileage weekly, Write the total at the end of each week for personal and for business.

* Write in the appropriate box for the each time you fill up with gas, change the oil, rotate the tires.

* Keep a large envelope in the back flap of the calendar for all your receipts.

* Keep the calendar, a pen and the envelope in the glove box or console of your vehicle.

* This only takes 30 seconds to record and trust me when I say it is simple yet effective.

* Or you can choose many electronic devices that are on the market today. But, the calendar and envelope system really works.

Beginning on Jan. 1, 2010, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:

* 50 cents per mile for business miles driven
* 16.5 cents per mile driven for medical or moving purposes
* 14 cents per mile driven in service of charitable organizations

The new rates for business, medical and moving purposes are slightly lower than last year’s. The mileage rates for 2010 reflect generally lower transportation costs compared to a year ago.

The standard mileage rate for business is based on an annual study of the fixed and variable costs of operating an automobile. The rate for medical and moving purposes is based on the variable costs as determined by the same study. Independent contractor Runzheimer International conducted the study.

A taxpayer may not use the business standard mileage rate for a vehicle after using any depreciation method under the Modified Accelerated Cost Recovery System (MACRS) or after claiming a Section 179 deduction for that vehicle. In addition, the business standard mileage rate cannot be used for any vehicle used for hire or for more than four vehicles used simultaneously.

Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.

Revenue Procedure 2009-54 contains additional details regarding the standard mileage rates.

For information regarding vehicle deductions for your business or an employee business expense Contact First Tax Solution LLC. We are the number 1 accounting firm for Small Businesses. We offer Virtual Accounting Solutions for your convenience. Contact First Tax Solution LLC, with our Professional Personalized Accounting Management Team we have the solution to meet your every Accounting and Tax needs.

Our Motto is Accounting and Tax Solutions When You Need It.

Sign up for our free Newsletters

Contact First Tax Solution
Reblog this post [with Zemanta]

No comments:

Post a Comment