On the list of things that businesses can deduct on their taxes is the mileage from business-related trips. This is especially beneficial for businesses that spend time driving to see clients or to pick up supplies.
Here’s the Story
One business owner in Charlotte, NC who spent much time driving to see her various clients tried to claim deductions for the miles she traveled, but did not have sufficient documentation to back up her deduction claims. Well, the IRS took a closer look into her business’s claims and denied her deductions.
What documentation was she missing? She did provide a mileage log that included the date, origin and destination for each trip, reason for the trip, odometer readings, and total miles driven, but she neglected to include specific reasons for each trip. She categorized each trip as “business” but failed to include the client’s name, address and other specific details of the business that took place on each trip.
Here’s the Point
Just tracking mileage is not enough to get deductions on your taxes. If you do not know all that you need to document, then you could be flagged by the IRS and miss out on funds that would otherwise be yours. Having a professional on your team will relieve you of the burden of needing to learn all the IRS requirements on your own. A professional will also be able to get you set up with systems that will ensure you’re prepared in the event of a tax audit.
For example, did you know QuickBooks Online has a builtin feature to assist you with tracking your mileage correctly? We can help you both set up this program and support you by making sure it is maintained while we handle your books. With the right team on your side, you don’t have to handle it on your own.
Contact us today to learn more about how our professionals at JRB can help you stay current and prepared in your business’s finances!