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Hitting the road for miles means more than just delivering cargo. For tax season, it’s crucial to log miles for potential deductions. But with so much information out there, it can get confusing.
This guide breaks it down for truckers, explaining what you need to know about logging mileage and IRS mileage log requirements.
A mileage log, specifically for truckers and tax-deduction purposes, is like a detailed journal for your truck’s travels. It tracks every trip you take and the distance you cover to help you claim tax deductions on eligible miles driven for business purposes.
Simply put, it is a record-keeping tool that shows the IRS exactly how much you used your truck for work. This helps you reduce your taxable income and potentially save money on taxes.
In a nutshell, the IRS has specific rules for keeping a mileage log. You need to include:
Date of each business trip
Starting and ending odometer readings
Purpose of each trip (e.g., pick-up, delivery)
Starting and ending locations
To help you with logging mileage, IRS requires these following requirements to be fulfilled:
Don’t wait weeks or months to log your trips. The IRS prefers records created close to the time of the trip for improved accuracy and reliability.
Track mileage using pen and paper, spreadsheets, or an approved mileage tracker app. No matter the format, ensure it’s easily accessible and organized.
Go beyond simply “business trip.” Document the exact purpose and locations of each trip. This gives the IRS a clear picture of how you used your truck.
Use a reliable odometer and record the odometer reading at the beginning and end of each business trip. Don’t worry, they only require the odometer readings at the start and end of the year and when you start using a new vehicle.
Hold onto your mileage log for at least three years after filing your tax return. This gives you time to address any potential IRS inquiries during audits.
Remember, only miles driven for business qualify for tax deductions. So, focus on logging trips related to your trucking business, like picking up and delivering loads, traveling for repairs, or attending industry events.
As a trucker, only miles driven exclusively for business purposes are tax deductible. Here’s a breakdown of what counts and what doesn’t:
Picking up and delivering loads: This is the core of your business, so all business miles for hauling cargo are deductible.
Traveling to truck stops: Miles spent getting fuel, repairs, maintenance, or supplies for your truck are deductible.
Attending industry events or meetings: Conferences, seminars, or training related to your trucking business qualify.
Deadheading: Business miles driven while empty between pick-up and drop-off points are generally deductible.
Daily commute: Miles driven between your home and your usual starting point for work trips are not deductible.
Personal errands: Grocery shopping, going to the gym, or running personal errands are personal miles, not business mileage.
Vacation or leisure travel: Miles driven for personal trips, even if you use your truck, are not deductible.
While the IRS doesn’t actively verify every mileage log, they have tools and methods at their disposal to assess its accuracy and legitimacy through random audits, cross-checking, industry benchmarks, verification tools, and even witness interviews.
Like any tax document, your mileage logs can be randomly selected for a random audit. This involves the IRS reviewing your mileage log for completeness, consistency, and adherence to the IRS requirements mentioned earlier.
The IRS may cross-check your mileage logs with other records, like expense reports, fuel receipts, or toll booth tickets, to see if the claimed miles align with your truck’s usage and reported expenses.
They might also compare your claimed mileage with average figures for similar trucking operations in your region. Significant deviations could raise red flags.
In rare cases, the IRS may use specialized tools or software to analyze your log for patterns, inconsistencies, or potential tampering.
If discrepancies arise, the IRS might interview you or other parties involved to understand your mileage tracking practices and clarify any concerns.
By being transparent, organized, and compliant, you can significantly reduce your chances of encountering issues with the IRS regarding your mileage log.
Logging an accurate mileage log for tax deductions isn’t just about scribbling numbers on a napkin. It’s about setting yourself up for tax savings while staying compliant with the IRS.
There are multiple methods at your disposal. Here’s an overview of each option and help you find create a compliant mileage log.
Using pen and paper for mileage tracking is simple, free, but prone to errors and lost records. It is ideal for budget-conscious, old-school truckers.
Digital spreadsheets for tracking mileage are more flexible, allows analysis, and can easily calculate big numbers, but requires manual entry and tech skills. Ideal for data-savvy truckers who like tinkering.
Using a mileage tracker app for IRS mileage log requirements has a couple of pros: automatic recording, minimizes errors, saves time, and makes tracking easier. However, there are fees and privacy concerns. Ideal for convenience-loving, tech-comfortable truckers.
Experiment and find what fits your tech skills, budget, and data needs.
Claiming mileage on your taxes as a trucker involves two key steps: keeping a mileage log and calculating your deduction using the chosen method. Here’s a breakdown:
Remember, the IRS requires a contemporaneous, detailed, and accurate log. Choose a method that works for you and ensure it includes:
Date: When did the trip occur?
Start & End Odometer: Capture readings at the beginning and end of each business trip.
Purpose: Clearly distinguish business trips from personal ones (e.g., hauling load, attending industry event).
Start & End Location: Specify where you started and finished each business trip.
Truck drivers have two options to claim mileage:
Standard Mileage Rate/Standard Mileage Deduction: This IRS-set rate per mile eliminates detailed expense tracking. For 2024, the rate is 65.5 cents per mile. This method is easier, has less paperwork, but might underestimate deductions for high-mileage drivers or those with significant expenses.
Actual Expenses Method: This method involves tracking all truck-related expenses (fuel, repairs, insurance, etc.) and deducting a portion based on the percentage of business use. The actual expense method is more complex, requires detailed records, but offers potentially higher deductions, especially with high cost.
Include your chosen mileage deduction on your tax return form (Schedule C or Form 1040, depending on your filing status).
Attach your mileage log for reference (optional, but recommended).
By following these steps and choosing the right method, you can maximize your mileage deductions and get significant savings on your taxes. Remember, accurate and consistent record-keeping is key to minimizing the risk of IRS inquiries come tax time.
