How to Calculate Gas Mileage for Reimbursement

Be sure to accurately chart the miles you drive so that you get a tax deduction.

While many people know that they can deduct mileage driven for business purposes, they may not know that they can also deduct mileage for charitable work as well as medical and moving expenses. Each of these expenses has a different "per-mile" deduction, which is adjusted each year by the Internal Revenue Service in accordance with ever-fluctuating transportation costs.

Things You'll Need

• Notebook
• Pen
• Calculator

Instructions

1. Create a table for the miles that you drive. The best way track miles is to keep a notebook in your car. Create a table in a notebook that includes the the following subheadings horizontally across the top of the page: Date, Medical, Moving, Business and Charitable. The date will show when you drove, while the other subheadings represent the four deductible mileage categories. On the bottom, left of the page, write "Total." This is where you will total the mileage for each category.

2. Keep track of your odometer. Every time you drive for one of these purposes, input the starting and ending mileage under the appropriate column. List this mileage in equation form so it is easier to calculate. Example:

   Ending Mileage - Starting Mileage = Total Mileage

3. Calculate the total miles in each column. Subtract the starting mileage from the ending mileage for each trip on your table. For instance, if someone drove members of a charitable organization around to deliver meals for the elderly and his odometer read 20,304.1 at the start and 20,334.1 at the end, the equation would be:

   20,334.1 - 20,304.1 = 30

4. Add the mileage driven for each vertical column to get a total for the year. For example, if someone drove 20.3 miles for medical treatments 20 times over the course of the year, the medical column would be added together to get the total. In this example the equation would work out to 406 miles. The number 406 would be entered next to "Total" at the bottom of your table under the "Medical" column.

5. Calculate and add the mileage for each category in the mileage allowance. The 2010 rates for mileage are 50 cents for business miles, 16.5 cents for moving and medical driving, and 14 cents per mile for charitable work. For instance, say someone drove 10,000 miles for business, 406 miles for medical care, 250 miles for moving and 100 miles for charitable work, the equation would be the following:

   (10,000 x 0.50) + (406 x 0.165) + (250 x 0.165) + (100 x 0.14) = Mileage allowance for the year.

   When calculated, this would equal $5,000 + $66.99 + 41.25 + 114 = $5,222.24.

Tips & Warnings

• Be sure to check the mileage rules each year as the rates and allowances are ever-adjusting. For instance, currently you cannot take a mileage deduction if you have a job in which you drive to a set place every day. If you drive to visit clients, and are not reimbursed, however, you can take the deduction. Also, the medical driving deduction may be able to be taken if you are driving someone else who needs care. Check with the official IRS website for the latest details.

• If you feel that the mileage deduction is actually undercutting the true cost of running your vehicle in these areas, you may deduct the actual fuel and maintenance costs instead of the standard mileage deduction. Just be sure to keep good receipts in case the IRS wants proof.

References

• Internal Revenue Service: 2010 Mileage Rate
• IRS: Moving Expenses