Can I deduct milage on my income tax return?

Question

I am new to the field of merchandising. I travel to various stores within a 50-100 mile radius, stocking and servicing different products. I travel anywhere between 30 and 200 miles per day. Can I deduct this milage on my income tax return for 2007 as a job expense?If so, how should I best keep records of my milage? What about gas? Can that be an expense as well? I do not get paid milage reimbursement from the company that I work for, if that makes a difference. Thanks in advance for all your advice.

Answer 1

You are allowed to deduct it if you have to do it for your job and you don't get reimbursed. But you must keep detailed records of the mileage. This includes starting and ending mileage for the year along with the number of miles for work and for personal. You can take your mileage deduction one of two ways (but not both) either you take the standard mileage rate based on the number of miles used for work or you can keep track of all of the money spent on gas for work and deduct that - most people find they get a better deduction taking the standard mileage deduction. It just depends. You can keep track of both throughout the year and at tax time take the one that gives the most.

Answer 2

Assuming it's your own car and the company doesn't provide you with one, yes you should be able to deduct mileage as an unreimbursed employee business expense if you itemize. It's subject to a limitation that you can only deduct the amount that's over 2% of your adjusted gross income.

Get a notebook or a small calendar and keep in in your car, and every day write down the miles you drove on the job.

Mileage includes all car expenses, so you can't deduct that AND gas. You have the option of taking a percentage of your actual car expenses instead of mileage, the percentage being the part of the total miles driven that are job miles. Taking actual expenses takes a lot more record-keeping - it's usually easier to just take mileage.

Answer 3

Yes, you can take a deduction for miles driven for business purposes on you Federal Tax Return. The rate for 2006 was 44.5 cents per mile. The rate for 2007 will be determined by the IRS by the end of this year. You will need to keep a daily record of your business miles because the IRS will want to see it if you are ever audited. Or you can deduct actual automobile expenses related to the business miles driven. Keep track of all automobile expenses and pro rate them against any personal miles you drove. Check which total is higher and use that number. If you have a gas efficient car, the mileage rate will probably work best.
Good luck!

Answer 4

You probably have a lot of deductible expenses running a home daycare. It would be a good idea to see a CPA (NOT H&R Block) to get advice on what you can deduct and what records you need to keep.They'd probably have some suggestions you might not have thought of on legal deductions. You need to claim income in the year you receive it, so no, you don't have three years to report the nurse aide income, it must be claimed on your 2006 return. You might be thinking of the rule that lets you collect your refund without penalty if you file up to three years late and have one coming. You can definitely deduct your uniforms for that job. If you work at a facility regularly, like a hospital or nursing home, then you would not be able to deduct mileage, it would be commuting expense which isn't deductible. If you're traveling to homes of clients, you might be able to - another question for a CPA, since it depends on circumstances. If your mom's gross income for the year was under $3300 and you provided more than half of her support, then you can claim her if a few other rules are met, which they probably are. With two kids, and probaibly a dependent mom, $25K isn't a lot of money, so with any luck you'll still get your financial aid. It's not a matter that "they'll say" you made a lot of money - you made what you made, and not to claim it is illegal, plus you'd probably get caught and have to pay the back taxes, plus interest and possible penalties, plus cheating on taxes COULD affect future financial aid. As long as the baby was born anytime i 2006, you can claim her. The "someone" who told you she had to be born by June is wrong. On $25,000 income, unless you have a lot of deductions (again, see the CPA) your child credit even with two kids will probably not cover your self-employment tax. You'd almost surely also get the EIC - together, they might cover it, maybe with enough to get something back. You'd pay this on your net income, so it all depends on how many deductible expenses you have. Good luck.

Answer 5

Read all the answers. I would add that

1. If you are an independent contractor rather than an employee, you can deduct your mileage fully, it will not be subject to a 2% floor, as it is if you are employed.

2. Whether you deduct mileage or take actual expenses, you can also deduct parking and tolls, so keep a record of those.

3. If you are not an employee, and are purchasing your vehicle, you can also deduct a pro-rated share of the finance charges.

4. You also need to keep track of miles that are not business miles. This is so that if you take actual expenses, or finance charges, you take a pro-rated amount based on the amount of business use of the vehicle.

In most cases mileage works out better for the taxpayer. Taking actual expenses, you need to keep track of depreciation, and if you trade in your car, it gets very complicated to figure actual expenses.

Answer 6

Most of the answers are correct. Note the following add on piece of information -

If you can be reimbursed by the company but you don't for whatever reason The expenses are NOT deductible. In other words you cannot choose to be reimbursed or take the deduction.

The expenses are (assuming you get a W-2) an unreimbursed employee business expense reported on form 2106. They will be subject to a 2% of adjusted gross income limitation

Answer 7

I have nothing else to add except that the mileage rate for 2007 is 48.5 cents per mile.

There is a lot of good information here for you. Just keep good records if you decide to deduct the actual expenses or mileage.

Answer 8

Here's the link you want.
Yes, mileage May be deductable under certain circumstances.
Check this site.
Generally you can deduct mileage OR actual expenses( gas, tirees, oil, etc).
Good luck, and keep good records, starting now.

Answer 9

most likely you can only deduct either the miles or the actual expenses (gas, repairs, etc) but not both. review the irs.gov regarding business use of your car at http://www.irs.gov/taxtopics/tc510.html