car mileage deduction FloridaCar Mileage Deduction – Florida

Last week, this Miami Beach bookkeeping company helped you understand how to write off meals on your tax return, so this time we’re taking a closer look at car mileage deductions. If you use your car for business purposes, you can deduct its cost of operation, but if you use it for both personal use and business, the car mileage deductions only apply to the business portion of it. But before we get into the precise percentage considered for a tax deduction, let’s first go over the basics of what qualifies as a business mileage deduction.

What business activity does the IRS consider a business trip?

The IRS allows you to deduct car mileage when you actually “drive” for business trips and purpose. So if you happen to have multiple offices for example, such as a law practice in various cities, and you drive from one to another during the week to better serve your clients, than all of that driving is considered  “business trips” and therefore the mileage is deductible.

Car mileage deductions also apply when you’re driving to purchase business supplies as well as run business errands. The Miami Beach bookkeeping company reminds you that the driving you do when making deposits at the bank, purchasing toner for your printer, picking up merchandise from vendors, even buying stamps, all qualify for car mileage deduction. Small business owners tend to forget about these types of activities, traditionally keeping better track of the more long-distance traveling. But all of these add up through the year, especially since they’re more likely to be frequent business activities you use your car for.

Going back to a topic this Miami Beach bookkeeping company discussed last week, meals and entertainment write-offs, business trips you make to meet up with clients, vendors, also count as a car mileage deduction. Even when you’re traveling for business, say to another state, driving to and from the airport is considered a business drive. Every time you drive your car to a specific meeting spot, you can deduct that business activity.

Temporary job sites also fall into this category, like for example should you drive to a new construction site or sales office just for three months,  that too counts as a car mileage deduction. Just make sure to keep track of it all, should you need help know that you conveniently outsource your bookkeeping to Your Bookkeeping Department in Miami Beach. We’ve got a simple and safe way for you to submit your documents, so your books can consistently be updated and you’re not overwhelmed during tax season.

The IRS also allows you to deduct your car mileage if you’re looking for a new job in the same industry, but not if you’re trying to change career path.

What is the precise car mileage deduction allowed for tax write-off in Florida?

Car Mileage Deduction Taxes FloridaIn 2017, the IRS allows you to claim 53.5 cents (as opposed to 54 cents in 2016) per business mile on your annual tax return. This Miami Beach bookkeeping company reminds you that there’s no limit to the amount of mileage you can claim, however you need to make sure the business trips qualify and keep a mileage log for proof.

Commuting is not deductible:

As you’ve seen above, not every business trip can be written off; and commuting falls into that category. Commuting is, under no circumstances, deductible because the IRS sees it as a personal expense. Commuting is defined as when a person drives to and from work, to a permanent location such an office or principal place of business, for over a year. Even if you’re meeting a client at your office, that’s still considered commuting. Another thing to note on commuting, is that even if you’re doing a business-related activity, say have a business discussion, while you’re commuting to your office, that drive is still not eligible for car mileage deduction.

Working from home and car mileage write-offs:

If you work from home, in other words, remotely, then your office is your home and you’re not regularly commuting. Therefore, when you drive to another business location, those miles are deductible. If you drive to a conference, workshop or even a second office, those are all considered car mileage write-offs.

car mileage tax deductions FloridaHow to claim car mileage on your taxes in Florida:

If you’re self-employed, just fill out the IRS Form Schedule C to claim your mileage. Besides your actual miles, this Miami Beach bookkeeping company reminds you that the IRS also needs you to submit your starting odometer reading, your commuting miles as well as your personal ones. Note that even if you’re a W2 employee, there are situations you can claim your miles.

If you’re going to claim the standard mileage rate, know that operating expenses such as repairs, gasoline, insurance and depreciation, can’t be deducted since they’re already factored in. But you can still deduct the interest you pay on a car loan as well as parking fees and tools when on business trips (not at your regular office).