The Average National Reimbursement for Mileage
The IRS sets national standards for mileage reimbursement for those that would like to claim reimbursement for mileage via tax deductions. These mileage figures are also used by businesses to determine how much someone should be reimbursed for the use of their own vehicle in conducting the firm's business. If you use the IRS figures for deductions, you will have those amounts deducted directly from your income amounts, and thus save on your tax payments.
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Mileage Covered
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Trips that you make for your own small business, or for your employer (if you work for someone else) are covered. For example, should you be required to drive to a client's place of business or to some work site (other than your regular office), log those miles. Transport or purchase of materials in the course of your job and other such trips are also covered.
Documentation
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You have to record your mileage consistently. This will give you the accurate figure at the end of the year, and also provide documentation (in the possibility of an audit). Write down the miles at the conclusion of a trip. Also note the date and location of the drive. Finally, you must note the business reason for the trip.
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How Much
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The figures for the deductions for mileage for every tax year are published by the IRS prior to the beginning of the year in question. The deduction amounts for the 2010 tax year were published in December of 2009. The business deduction for 2010 was 50 cents per mile; the rate for 2011 is 51 cents per mile. The figure does not change massively from year to year. Changes generally reflect fuel costs.
Caveats
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You may not receive both reimbursement for the same mileage from both the IRS and your employer. Also, the mileage figure published by the IRS is inclusive of things like repairs to your car and gas. You can actually itemize all the repairs and other costs for driving you car for work, but you must keep conscientious records of these charges. Extra direct costs, like tolls or parking, are a separate matter and can be claimed separately.
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References
- Photo Credit yellow car, a Honda Japanese sport car model image by alma_sacra from Fotolia.com
