Tax Tip: Advantages of Using Standard Mileage for Auto Expense

By Rosheila Motley

Advantage 1 – It’s Easier: The rates are very generous, and, unless you use your vehicle 100% for business, it’s much easier to figure your deduction using the rates, rather than using actual expenses.

Advantage 2 – It’s More Flexible: As a general rule, it is usually better to take the standard mileage rate the first year you put a car or truck into service, rather than actual expenses. This allows you some flexibility in subsequent years, because you can choose which to take. However, if you take actual expenses in the first year, you must continue to use actual expenses thereafter.

Advantage 3 – You May be able to Write Off More: For people who drive many business miles each year, taking the standard mileage rate may allow you to write off more than the value of your vehicle over a period of years.

Advantage 4 – It’s Easily Defended: If you get audited and you’ve kept a good log book, your mileage deduction will most likely remain intact.

Tip  – Keep Good Records: Keep a log book in your car and record the following information each time you drive the car for business reasons:

• Date
• Business Reason/Place Visited
• Beginning Odometer Reading
• Ending Odometer Reading
  

  Rosheila Motley

Rosheila is the President and CEO of  Motley’s Financial Services, which provides accounting, tax, and consulting services to individuals, partnerships, corporations, and non-profit organizations in the local and surrounding areas.  She is also a Lifetime Member of the National Association of Black Accountants, Inc. (NABA) and currently holds the position of Director- Division of Firms in the Austin-Centex Chapter.  She can be contacted at ROSHEILA@MOTLEYFINANCIAL.COM or 210.896.0496.