Requirements for keeping track of business mileage?

Requirements for keeping track of business mileage?

Fort Lauderdale, FL · Member since 2016 · 146 posts · 27 votes

I see a lot of articles that state you can use an app to track your miles, however it also always mentions in other sections that the IRS requires that you keep track of your miles as they are occurring, not weeks later etc. Is there anyone out there that has kept track of their miles using solely an app? If so what have your experiences been?

I suppose that maybe an app would show what day/time the record was created... But if not, it seems it would be hard to prove that something was entered way back in January, versus a few days prior to tax time.

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Accountant, Enrolled Agent · Grayslake, IL · Member since 2011 · 5k+ posts · 2k+ votes
9y
Originally posted by @Jazmine S.:

I see a lot of articles that state you can use an app to track your miles, however it also always mentions in other sections that the IRS requires that you keep track of your miles as they are occurring, not weeks later etc. Is there anyone out there that has kept track of their miles using solely an app? If so what have your experiences been?

I suppose that maybe an app would show what day/time the record was created... But if not, it seems it would be hard to prove that something was entered way back in January, versus a few days prior to tax time.

 You will also want third part verification such as an oil change statement that shows the mileage ont he car at that date to prove the miles were put ont he vehicle. 

You can recreate them that is perfectly allowable under the Cohan Rule. This was a case in which the taxpayer's records were destroyed and had to be recreated.

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  • Investor · Allentown, PA · Member since 2015 · 101 posts · 69 votes
    9y

    Sorry, Jazmine- I keep track of all of my miles the old fashioned way- manually, as the day progresses.  I enter the locations into a text screen on my phone, and later, transfer them into a little ledger book.  At the end of the month, I transfer the per-property miles onto a spreadsheet for my end of year taxes ( I used to do it all at the end of the year- what a nightmare)  If challenged, my daily log will always line up with "hard" evidence like bank deposit receipts and home depot slips.

  • Chicago, IL · Member since 2017 · 39 posts · 33 votes
    9y
    Try Mileiq app for iphone. It tracks everywhere you drive and then you can sort by personal and business. It great app.
  • Accountant, Enrolled Agent · Grayslake, IL · Member since 2011 · 5k+ posts · 2k+ votes
    9y
    Originally posted by @Jazmine S.:

    I see a lot of articles that state you can use an app to track your miles, however it also always mentions in other sections that the IRS requires that you keep track of your miles as they are occurring, not weeks later etc. Is there anyone out there that has kept track of their miles using solely an app? If so what have your experiences been?

    I suppose that maybe an app would show what day/time the record was created... But if not, it seems it would be hard to prove that something was entered way back in January, versus a few days prior to tax time.

     You will also want third part verification such as an oil change statement that shows the mileage ont he car at that date to prove the miles were put ont he vehicle. 

    You can recreate them that is perfectly allowable under the Cohan Rule. This was a case in which the taxpayer's records were destroyed and had to be recreated.

  • Real Estate Broker · Portland, OR · Member since 2015 · 39 posts · 18 votes
    9y
    I agree with Sam T. , MileIQ is very easy, inexpensive, and all you need. If you let it track your location even while the app isn't on, it'll log every drive in the app until you swipe left (personal) or slide to the right (business).
  • Fort Lauderdale, FL · Member since 2016 · 146 posts · 27 votes
    9y

    Great advice @Account Closed that sounds great! Too bad the only apple product I have is my iPad and it appears that app is only available for iPhones! (I don't have anything with Google Play either). The mile counters that I've seen for the iPad look like they probably aren't up to par with MileIQ. Maybe one day they'll expand! I'll stay on the lookout for now. :) Just saw a demo and it looks terrific.

  • Boca Raton, FL · Member since 2015 · 249 posts · 52 votes
    9y

    As long as you have records for an audit that do not appear like you created them at the time of audit, you should be ok, whatever method you choose.  The record should indicate the amount of miles and the business purpose, .  Also keep your oil change and repair records which should show current milesge and further cooberate your mileage claimed.

  • Investor · Jacksonville , NC · Member since 2015 · 143 posts · 54 votes
    9y
    +1 for MileIQ. Great app. Especially since the recent update. For the OP, with MileIQ you can create a log on the primary website by manually adding drives.
  • Fort Lauderdale, FL · Member since 2016 · 146 posts · 27 votes
    9y

    @Nicholas Hooyman not that anyone cares at ALL but I just had to shout out to the rooftops that I was able to "play too"! I'm new to the iPad and didn't know that even when you choose to view the "iPhone only" apps, you can still download them on the iPad and most will work. A rep at MileIQ advised me of this, and the app looks great. I'm letting it run for a few days to see how it does.

    Thanks everyone for the great advice!

  • Real Estate Broker · Portland, OR · Member since 2015 · 39 posts · 18 votes
    9y

    haha I love it, thanks for including me in your journey! I haven't gotten an iPad yet, I just switched over to Apple for my phone and am so happy with the user interface. The iPad is the next step for me too, so that's good you know, thanks!

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