What Are The Rules for Writing Off My Mileage as a Business Expense?

That's a great question! There is a lot of misinformation out there about what the IRS does and doesn't allow you to do for using mileage as a business expense. There is certainly a way to legitimately deduct this, but you want to make sure you're doing it correctly. This is one of many areas a bookkeeper can provide guidance and input for you as you live your life as an entrepreneur.

First, you'll need to decide if you're going to use the standard mileage rate, or the actual expense rate. The standard mileage rate is a set amount the IRS will allow you to use for each mile traveled for your business. In 2019, that rate is 58 cents a mile. This is to allow for fuel expense as well as wear/depreciation of the vehicle itself. The actual expense method would involve you keeping track of your fuel costs, oil changes, and any other car related expenses and deducting those actual costs. This would be harder for a business owner to do if they use their car for business as well as personal use.

So what are business miles? What can I deduct?

You can deduct mileage for trips for the following areas of your business:

Traveling to and from your office.

Running errands and picking up things needed for your business.

Traveling to meals and entertainment for clients.

Traveling to an airport for a business trip.

Be careful and honest when tracking these things! Don't take a grocery trip for your personal items and throw in a stapler just to call it a business trip to the grocery store. Do your best to keep track of your mileage for your business-specific trips, and at the end of the year your bookkeeper or CPA can advise you as to which deduction option you should use.