How to Claim a Gas Mileage Deduction for a Small Business
The gas mileage rate subject to tax deductions changes annually, so it's important to stay current with IRS regulations. Follow these steps to maximize the benefit of each deduction you claim for your small business.
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Instructions
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Limit the number of vehicles your small business uses. Generally, the IRS only permits a small business to claim the standard gas mileage deduction if they operate four vehicles or less.
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Be aware that business-related travel is a valid claim for gas mileage deduction. However, this does not include commuting to and from your place of business.
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Compare computation methods. The IRS permits a gas mileage deduction using one of two calculation methods--either cents-per-mile or the total of the actual expense incurred. The method you use will depend on several factors, such as distance traveled and current gas prices. Consult a Certified Public Accountant for the best approach for your small business.
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Tips & Warnings
To search the IRS Web site for information about gas mileage deduction rates, enter the phrase "gas mileage" in the search box.
Keep careful and detailed records to validate each gas mileage expense deduction you claim.
The IRS meticulously monitors business-related deductions. Keep your records for up to 10 years, just in case you are audited.
Never try to manipulate your gas mileage expense deductions to claim more than you are entitled to. This could send a red flag to the IRS and result in an audit. If they find that you inflated your claims, you could owe the IRS more taxes as well as fines.
