As a small business owner, I know that expense tracking – especially those related to mileage – can be tricky and time consuming. Wanting to have a better sense of the mileage I actually racked up, I tried an experiment last April after completing my taxes. Going in I didn’t think driving around in my trusty Prius to and from client meetings and running business-related errands would amount to much. Yet after using a simple mileage log for 60 days, I was stunned to discover I drove 450-500 miles each month. At 50 cents a mile, that was an extra $225 out of my pocket! If you’re an employee that’s on the road a lot (like a sale representative) where you use your personal vehicle on the job, it’s most likely a reimbursable expense. If your employer doesn’t cover the costs, your mileage (and other vehicle related expenses) may be a tax deduction. To make sure, talk to your tax preparer or CPA to confirm what’s allowed based upon your specific situation. When you’re a solopreneur or small business proprietor, you’ve got to wear many hats – often at the same time. Keeping track of business-related mileage isn’t sexy and a bit time consuming, but can add up to an appreciable expense you can deduct. Make a commitment for just one month using one of these methods:
- If pen and paper is more your style, I recommend picking up a mileage log from an office supply store or create your own on a spreadsheet. A client puts the log on her dashboard so she’s sure to see it every time she starts the car.
- For those addicted to their Smartphone (like me), there are several great apps that are free. But if you want a little more functionality (like one that syncs with your phone’s GPS) it may be worthwhile spending a little to make it easier and more fun in the process.
- For something in between, use your calendar (electronic or paper) to make mileage notes. By incorporating your expense tracking and mileage log into something you already use, you are more likely to stick with it.
By keeping a more accurate log of your mileage, it more than pays for itself especially if it lets you keep a little more green in your pocket. Need help in keeping track of your business expenses? Then schedule a free 30-minute consultation with Fiscally Fit, Inc. Email me at Alison@fiscallyfit.us or call (650) 965-4090 for a no-cost, no-obligation appointment.